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Owner Controlled Insurance Programs versus Traditional Insurance Programs
Finance & Accounting
Pages 10 (2510 words)
Owner Controlled Insurance Programs versus Traditional Insurance Programs Table of Contents Introduction 3 Risks Associated with OCIP 4 Risk of Owners 4 Risk of Contractors 5 Alternative Perspective 6 Literature Review 7 Supporting the Position of Being in Favor of OCIP 10 10 Recommendations 11 Conclusion 12 References 13 Bibliography 15 Introduction An Owner Controlled Insurance Program (OCIP) is a scheme through which an owner of a project tries to provide diverse types of insurances to contractors as well as subcontractors in United States.
It is purchased by construction owner for the benefit of builders or contractors engaged with the project, which includes compensation of workers, general liability, pollution liability, builders risk and professional liability among others. OCIP is a comparatively new vehicle in insurance sector for residential projects. Due to rapid growth of defective constructive designs, these policies are becoming highly popular among the builders and the contractors (Grenier, 2001). The study is mainly based on the analysis of OCIP versus Traditional insurance programs. Both the insurance policies play vital roles in the construction sector but OCIP provides advanced reliability than traditional insurance policies, as OCIP wraps up multiple policies provided by the owner to the contractors or the developers in a project including the facilities which are not supported in traditional insurance policies. Risks Associated with OCIP OCIP is commonly known as Wrap-Up Policy in United States. Both the OCIP and traditional policies were developed in 1950’s. ...
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