Which insurance is also known as wrap-up insurance?

Which insurance is also known as wrap-up insurance?

• A. Builder's Risk Insurance
• B. Contractor Controlled Insurance Program
• C. General Liability Insurance
• D. Professional Liability Insurance

Answer: (B)

Wrap-up insurance, commonly referred to as a Contractor Controlled Insurance Program (CCIP), is designed to cover multiple parties involved in a construction project under a single insurance policy. This type of insurance is typically utilized for large construction projects to streamline the coverage process and minimize gaps in insurance among subcontractors, contractors, and the project owner. By implementing a wrap-up insurance approach, all parties involved can achieve consistent coverage terms and potentially lower overall insurance costs due to the consolidation of purchasing power. The advantages of a Contractor Controlled Insurance Program include reducing administrative burdens, providing comprehensive coverage for all enrolled parties, and addressing liability risks in a more uniform manner. This holistic approach promotes a safety culture, as all participants are generally held to the same risk management standards. In contrast, other types of insurance mentioned in the choices do not encompass the broad, unified coverage that wrap-up insurance provides. Builder's Risk Insurance typically covers damage to buildings under construction but does not extend coverage to all parties. General Liability Insurance protects against liability claims but is usually purchased separately by individual contractors rather than on a collective basis. Professional Liability Insurance is focused on the errors and omissions of professionals, offering coverage related to negligence in services rather than project-wide risks.

Wrap-up insurance, commonly referred to as a Contractor Controlled Insurance Program (CCIP), is designed to cover multiple parties involved in a construction project under a single insurance policy. This type of insurance is typically utilized for large construction projects to streamline the coverage process and minimize gaps in insurance among subcontractors, contractors, and the project owner. By implementing a wrap-up insurance approach, all parties involved can achieve consistent coverage terms and potentially lower overall insurance costs due to the consolidation of purchasing power.

The advantages of a Contractor Controlled Insurance Program include reducing administrative burdens, providing comprehensive coverage for all enrolled parties, and addressing liability risks in a more uniform manner. This holistic approach promotes a safety culture, as all participants are generally held to the same risk management standards.

In contrast, other types of insurance mentioned in the choices do not encompass the broad, unified coverage that wrap-up insurance provides. Builder's Risk Insurance typically covers damage to buildings under construction but does not extend coverage to all parties. General Liability Insurance protects against liability claims but is usually purchased separately by individual contractors rather than on a collective basis. Professional Liability Insurance is focused on the errors and omissions of professionals, offering coverage related to negligence in services rather than project-wide risks.