As there continues to be uncertainty with the economy going into 2023, many contractors may expand the type of work they bid on. These could include jobs that are covered under a Wrap Up, or commonly referred to as an Owner Controlled Insurance Program (OCIP) or Contractor Controlled Insurance Program (CCIP). The goal is for these programs to provide uniform coverage between all parties on site and that can result in cost savings for the party funding the program. Historically Wrap Ups were only used on large projects in excess of $100,000,000, but in recent years they are being used on smaller projects or to cover a series of projects under what’s called a rolling wrap-up. While they can have some benefits, Wrap Ups also come with risks for everyone involved in the project. Problems often arise when an owner puts a Wrap Up in place in order to cut costs or if the sponsor has someone advising them who is not experienced insuring these types of risks.
Standard General Liability and Umbrella policies will exclude projects covered under a Wrap Up, so don’t assume your existing policies will cover a claim if there’s an issue on the project enrolled in the Wrap Up. Here are five questions you should ask before you bid on a job that will be enrolled in a Wrap Up.