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BUSINESS NEWS DEWBERRY ENGINEERING PROJECT RECEIVES NEW JERSEYALLIANCE FORACTIONAWARD Dewberry , a privately held professional services firm, has announced that its Newark Bay-Hudson County Extension deck reconstruction project in Essex and Hudson counties was recently awarded a Leading Infrastructure Award by the New Jersey Alliance for Action. The award recognizes innovative, pioneering, and landmark construction initiatives that greatly impact New Jersey’s economy. Award recipients were announced during a virtual ceremony in February. “We are honored to receive this award,” says Dewberry Vice President and Senior Project Manager S. Andrew Kamilaris, PE.
“The success of this project allowed for enhanced safety and the prolonged life of the structures within this critical corridor,” adds Dewberry Project Engineer Edward Bier, PE. The New Jersey Turnpike Newark Bay- Hudson County Extension roadway serves as a critical connection between the Holland Tunnel, Interstate 78, Routes 1 and 9, and the Newark Liberty International Airport and Port Newark facilities. Dewberry provided engineering services for the preliminary and final design of the deck reconstruction and structural steel rehabilitation of the westerly approach structures, including one of the curved Interchange 14 ramps
and the structural rehabilitation of the iconic Newark Bay Bridge. Dewberry is a leading, market-facing firm with a proven history of providing professional services to a wide variety of public- and private-sector clients. Recognized for combining unsurpassed commitment to client service with deep subject matter expertise, Dewberry is dedicated to solving clients’ most complex challenges and transforming their communities. Established in 1956, Dewberry is headquartered in Fairfax, Virginia, with more than 50 locations and more than 2,000 professionals nationwide.
JOAN DELOREY & JARED MAXWELL, from page 3
those citing regional claim activity, 40 percent saw more claims in the Northeast and 35 percent in the Southwest. Meanwhile, 30 percent saw more claims each in the Southeast and West Coast. The higher claim levels can be explained in part by greater business activity in each of the areas. Nonetheless, some insurers are considering applying higher rates to firms with a concentration of projects in areas associated with higher claim activity. 8) Additional red flags for insurers: project delivery, complexity. Insurers also had underwriting concerns about fast track and designer-led design/build project delivery, construction complexity with increased costs, and public-private partnerships. Design firms expanding their involvement in these types of arrangements should recognize that some insurers are taking a closer look at them in terms of potential risks they represent. 9) Warning signs on cyber-risk. The COVID-19 pandemic and remote working arrangements left employers in all industries more vulnerable to cyber-attacks, including those involving ransomware. In this environment, design firms should take advantage of the pre-breach services available through their cyber-insurance policy to identify potential system vulnerabilities. In addition, putting the appropriate security measures in place to help mitigate a cyber-attack is becoming a critical component for meeting insurance underwriting requirements to obtain or renew insurance coverage. 10) Practicing sound risk management remains key for AEC firms. The good news is that despite all the concerns, there’s still some competition in the professional liability insurance marketplace. Nonetheless, the beneficiaries among design firms of any favorable conditions that remain this year will be those with clean loss histories, lower risk disciplines, projects, and sound risk management. However, for the most part, all indications point to 2021 being a year when more buyers see higher rates for their professional liability insurance. To obtain a complimentary copy of the Ames & Gough survey, PLI Market 2021: As Claims Experience Deteriorates, Insurers Seek New Rate Hikes , email info@amesgough.com. JOAN DELOREY, senior vice president and partner, Ames & Gough, and JARED MAXWELL, vice president and partner, Ames & Gough. Joan DeLorey can be reached at jdelorey@amesgough.com; Jared Maxwell can be reached at jmaxwell@amesgough.com.
in four insurers surveyed reported having more claims associated with certain project types, such as residential and infrastructure. As a result, underwriters look carefully at a design firm’s project mix in considering a potential rate action. While many design firms are looking for new growth opportunities, they need to recognize that project mix changes may affect how underwriters approach their policy renewals. 4) Higher-risk disciplines continue to draw underwriter scrutiny. Concerning their underwriting assessments, 95 percent of the insurers surveyed cited structural engineering as the top discipline in terms of risk, followed by geotechnical engineering (75 percent) and architecture (40 percent). Insurers’ historical claims data indicate higher claim frequency and severity coming from these disciplines. This leads insurers to apply higher rates to address historically elevated claims costs associated with these disciplines. 5) Rising claim severity, a troubling trend. Insurers were acutely concerned about a trend toward greater claim severity, especially related to high-risk projects and disciplines. Not surprisingly, insurers’ most significant claims involved bodily injury, design defects, property damage, or construction delays. Most insurers surveyed paid a multimillion-dollar claim in 2020: 45 percent paid a claim between $1 million and $5 million, and one in four paid a claim exceeding $5 million, including 10 percent paying a claim between $10 million and $20 million. 6) Some insurers push back on higher limit requests. A key indicator of the market tightening involves insurers’ responses to the growing number of requests for higher liability coverage limits. Although higher limits of $5 million and above continue to be available, these requests now are typically thoroughly vetted by the insurers. In light of these developments, design firms may want to check with their clients to make sure any requirements for higher limits align with the project risk or if they’re disproportionate given the scope of work. 7) More insurers examine increases in regional claims activity. Even though most insurers (60 percent) in this year’s survey indicated that no specific geographic area had an increase in claims activity, that’s a decline from last year when 73 percent reported no such trend. Notably, among
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THE ZWEIG LETTER MAY 10, 2021, ISSUE 1391
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