From Risk to Profit Benchmarking and Claims Studies

The previous discussion on project evaluation noted that project type was an important factor to consider when evaluating potential risks. The next step in evaluating your project is to examine the problem areas that are typically associated with any particular project type. This is an important step as the problem areas associated with a given project will help you determine how you may want to respond to a specific risk.

superstructure had the three highest claims frequency rates. If you are the prime professional on a healthcare project and you are considering retaining the services of a mechanical/electrical/plumbing (MEP) engineer, the chart below indicates that you should consider MEP engineers that have successfully provided professional services for healthcare facilities in the past. Retaining an MEP engineer that understands the HVAC, interior construction, and building superstructure needs for a healthcare facility may help minimize the likelihood of claims in those areas.

For example, the chart below indicates that for healthcare projects, HVAC, interior construction, and building

Healthcare Facilities: Claims by Problem Area (2010 - 2019)

The biggest problem area surrounding healthcare facilities was HVAC systems. From 2010 through 2019, they represented 30.3% of all healthcare facility claims and 19.8% of all insurance company dollars spent. Interior construction was also another problem area, with 20.8% of the frequency and 15.1% of the severity.

30%

25%

20%

15%

10%

5%

0%

Building Exterior Closure

Building Superstructure

Site Improvements

Electrical

Plumbing/ HVAC/Fire Protection

Interior Construction

Frequency = reported claims

Severity = CNA dollars spent

Commercial/Retail Projects: Claims by Problem Area (2010 - 2019)

25%

For commercial and retail projects, interior construction was a big problem area, with 21.2% of the claims frequency and 18.7% of the dollars spent. HVAC systems were also a big problem area, accounting for 16.6% of the claims frequency and 18.0% of the claims severity.

20%

15%

10%

5%

0%

Foundations/ Substructure

Building Superstructure

Site Preparation

Site Improvements

Interior Construction

Plumbing/ HVAC/Fire Protection

19 • From Risk to Profit - Benchmarking and Claims Studies

Victor

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