Managing Risk in Construction: Different Perspectives

Construction risk looks very different depending on where you sit. This session at RIMS 2026 explored emerging risk management and insurance issues through the distinct lenses of the project owner, general contractor, and subcontractor. Panelists examined how competing priorities and incentives shape decision-making around construction risk programs. Speakers included:

• Cheryl Berman – Risk Manager, Brady West, Inc.
• Ann Parnigoni – Chief Risk Director, BNBuilders
• Scott Ritto – Kilroy Realty Corporation

Construction Insurance Programs (CIP)

A centralized insurance program is used on construction projects to provide coverage for multiple parties under a single policy structure. Instead of each contractor and subcontractor carrying their own separate insurance, the CIP provides unified coverage for enrolled parties.

These programs are becoming more sophisticated with excess programs that exceed $1 million being very typical. Everyone involved with a project has to be involved with the program, so you need someone to administer the program, like a broker. They can be cumbersome to enroll and administer depending on size and scope.

There are two primary versions of a CIP, including:

• Owner Controlled Insurance Program (OCIP) – coverage provided by the owner
• Contractor Controlled Insurance Program (CCIP) – coverage provided by the general contractor

Builder’s Risk Insurance

This type of insurance is sometimes referred to as “course of construction” coverage, and typically ends at substantial completion. This is either provided by the project owner or the general contractor.

Often considerations, like environmental risks are covered as part of the ongoing course of the project. For example, if an area is prone to earthquakes or hurricanes, it will be included in builder’s risk insurance for the length of the project.

Subcontractor Default Insurance (SDI)

This is an insurance policy purchased by the general contractor and works as an alternative to subcontractor payment and performance bonds. It protects a project against subcontractor default.

This option can pay out faster with easier access versus bonds. It is also much broader coverage and covers subcontractors that follow the trade, servicing the project better.

Contract Language

Indemnification should be strong enough that insurance responds to intent, and carries balanced terms.