Aside from the obvious damage caused by financial losses and property destruction, this trend is also having an impact on how insurance underwriters sell builders risk insurance.
Rates are escalating due to the elevated risk environment, and developers and contractors with a poor track record of losses may find it difficult to secure insurance at all.
According to Construction Executive Magazine, “Due to increasing losses and poor investment returns, rates for most lines of coverage are increasing, capacity is declining and underwriters are being more selective on which accounts they will even consider.”
This presents a problem for both builders and insurance underwriters. Obviously, it’s not in insurers’ best interest to refuse coverage to potential customers − that’s how they make their money.
So, it’s not surprising to see many insurers taking steps to incentivize potential customers to adopt security measures that reduce the risk of jobsite theft. This often takes the form of offering discounts or even requiring the use of remote video monitoring services (RVMS) to secure jobsites.
As part of this, insurers are partnering with companies like Pro-Vigil as preferred suppliers of video surveillance solutions for construction jobsites.
Most often, this includes the use of Pro-Vigil’s mobile solution, which can provide proactive security deterrence on sites with no electrical service or WiFi.
Beyond this, developers and contractors can work with their insurers to develop a site security plan that provides common-sense measures (such as putting up fences and assigning responsibility for security to a team member), as well as pre-emptive technology solutions.
The construction theft epidemic is unlikely to wane anytime soon – and developers who are subject to excessive losses will become less desirable as customers for insurance underwriters, or find themselves paying higher premiums with higher deductibles than the competition.
Insurers can become part of the solution, by providing incentives on developers to implement modern security protection on jobsites and, better yet, referring customers to preferred vendors who have a demonstrated track record of success at securing jobsites in the construction industry.
Contact us to learn more about how RVMS can reduce the risk of theft on construction sites.
