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Construction projects are demanding, complex, and vulnerable. Being involved in large construction projects entails meticulous planning, skilled labor, and huge financial investments. However, big risks, such as natural disasters and equipment failures, can also disrupt project success and lead to financial losses. That is why it is crucial for project managers to understand the importance of safeguarding construction projects, machines, and equipment. Here are four risks associated with construction projects and see how Cocogen Engineering Insurance can mitigate them. 

As we all know, the Philippines is one of the most-disaster-prone country in the world. We are highly susceptible to natural disasters such as earthquakes, floods, and typhoons. Construction sites are particularly vulnerable to these calamities, which can inflict extensive damage to structures, materials, and equipment. This can cause lengthy project delays and costly repairs that affect budgets and timelines. 

Sample Scenario: 

A construction project in Manila is in its final phase when a powerful typhoon hits. The storm causes significant damage to the partially completed structure and the construction materials on-site.  

Mitigation Strategy: Contractor’s All Risk Policy 

Thanks to Cocogen Contractor’s All Risk (CAR) policy, the financial impact of the damage is covered. It allows the project to recover quickly, repair the damages, and continue without major delays. 

Cocogen’s Engineering Insurance includes a CAR policy that is designed to protect buildings and civil engineering projects during their construction phase. This policy protects against losses and damages caused by different types of risks, such as accidents and natural disasters. CAR insurance ensures construction stakeholders that any unforeseen accidents or calamities that damage the condition of buildings, civil engineering works, materials, and equipment are financially covered. This mitigation strategy not only alleviates the financial risks that natural disasters bring but also facilitates the project’s quick recovery and continuity, minimizing disruptions and preserving the investor’s confidence. 

Large construction projects depend a lot on equipment and machinery for various purposes, most frequently involving earthwork operations. These machines are crucial in ensuring that tasks are completed on time and making the construction process easier and faster. However, they are prone to breakdowns and malfunctions caused by accidents and natural perils, which can stop construction activities and lead to increased costs and delays.

Sample Scenario: 

During the installation of a new elevator system in a high-rise building in Makati, an important piece of machinery was damaged by a sudden earthquake. It unexpectedly stopped the project and caused significant repair and replacement costs. 

Mitigation Strategy: Erection All Risk Insurance 

The Erection All Risk (EAR) policy ensures that the project can resume without major financial setbacks. 

Cocogen EAR policy protects the project from damage or destruction caused by natural events like earthquakes during the erection or installation of machinery and equipment. This coverage offers financial security by covering the project’s important components used for various construction tasks. It ensures that any damage from such events is immediately dealt with to keep the project moving smoothly. This coverage is essential for sticking to timelines and budget, and it also helps reduce the risks associated with natural disasters affecting equipment and machinery. 

A construction site is a busy and demanding environment involving workers, contractors, and visitors. No matter how strict the safety measures are, accidents can still happen. Accidents resulting in bodily injury or property damage to third parties can lead to legal liabilities and financial burdens for the project stakeholders. 

Sample Scenario: 

A subcontractor accidentally damages a neighboring property while operating heavy machinery on-site. The property owner files a claim for the damages. 

Mitigation Strategy: Contractor’s All Risk or Erection All Risk Insurance 

The CAR policy covers the legal expenses and compensation costs, protecting the construction company from significant financial loss. 

Cocogen’s Engineering Insurance policies include Third-Party Liability coverage under both CAR and EAR insurance. This means that you're protected against claims for bodily injury or property damage from accidents on the construction site. This coverage is crucial for project owners, contractors, and subcontractors because it provides financial protection against legal expenses and compensation claims, helping to keep the project on track despite any unexpected liabilities. 

Modern construction projects rely heavily on electronic equipment for communication, planning, and execution. When one of these electrical devices fails, from computer systems to specialized tools, it can disrupt operations and cause significant delays. 

Sample Scenario: 

During a critical phase of a hospital construction project, the project management team’s computer systems are damaged by a power surge that disrupts the operations. 

Mitigation Strategy: Electronic Equipment Insurance 

With Electronic Equipment Insurance, the cost of repairing or replacing the damaged equipment is covered, minimizing downtime and keeping the project on track. 

Cocogen’s Electronic Equipment Insurance covers accidents on an "all risks" basis for electronic equipment such as hospital, computer and communication equipment (excluding mobile and handheld devices), miscellaneous equipment such as film and television studio equipment, among others. This coverage ensures that any damage or malfunction of critical electronic equipment is promptly addressed, reducing downtime and keeping the project on track. It provides peace of mind to project managers, knowing that their electronic assets are protected against unforeseen risks. 

Construction projects always come with their fair share of risks, from financial losses to unexpected delays. Cocogen's Engineering Insurance, which includes policies such as Contractor’s All Risk, Erection All Risk, and Electronic Equipment Insurance, is designed to cover these potential issues. By choosing the right insurance, project managers can protect their investments, keep their projects on track, and handle the challenges of construction with greater ease and confidence.