In particular, cleanup costs of pollution events have increased dramatically in recent decades. For example, the cost to remediate 126,000 polluted groundwater sites monitored by the U.S. federal government—due to contaminants from underground storage tanks, military installations and industrial facilities—could range from $110 billion to $127 billion. Also, as environmental legislation and case law continue to change, companies are finding it even more difficult to stay abreast of the environmental risk landscape. As such, today’s construction firms have an urgent need for comprehensive environmental risk management that fully addresses their complex and evolving exposures.
6. Expensive Equipment Leading to Costly Exposure
The latest generation of construction machinery, such as loaders, rollers, backhoes and cranes, boast sophisticated capabilities designed to deliver better efficiency, productivity and safety than earlier versions. However, the new capabilities have added to the costs of construction machinery and created new risk exposures as more contractors consider alternative cost-reduction strategies for the acquisition and maintenance of equipment. For example, rather than pure ownership, some contractors now prefer rental or leased equipment, which helps to free up cash while allowing them to meet their contractual obligations. One of the biggest exposures contractors face at jobsites is accidents that end up damaging expensive equipment and delaying projects. As with all the major trends impacting the construction insurance landscape, working with construction risk managers with proven industry experience is crucial. Often, it makes all the difference.