$100M Project Insured Under ONE Policy: Wrap-Up Insurance Explained (OCIP/CCIP)
The One Big Umbrella
Imagine trying to keep a huge crowd dry in a rainstorm using 50 different small umbrellas. It’s chaotic and someone will get wet. That’s a normal construction project. Now, imagine one giant golf umbrella covering everyone. That’s a wrap-up policy. For our $100 million hospital project, instead of having every subcontractor provide their own insurance, the owner bought one massive policy that covered everyone working on site for both liability and workers’ comp. It was one single, unified shield for a massive, complex project, ensuring no one fell through the cracks.
Simplifying Insurance on Massive Projects: The Power of Wrap-Ups
The End of the Paperwork Nightmare
As a project manager, my life before wrap-ups was a nightmare of paperwork. I had to chase down insurance certificates from 47 different subcontractors, check their limits, and track their renewal dates. It was a full-time job. On our next big project, we used a wrap-up. Suddenly, it was simple. Every contractor on site was automatically covered by the same policy. There was no more chasing paperwork. This streamlined process saved us hundreds of administrative hours and let us focus on what we do best: building the project.
OCIP vs. CCIP: Who Buys the Wrap-Up Policy? (Owner vs. Contractor Controlled)
Whose Party Is It Anyway?
I’ve worked on two major high-rise projects. The first was an OCIP, or Owner Controlled Insurance Program. The developer (the owner) bought the master policy. They controlled the coverage and we, the General Contractor, just had to play by their rules. The second project was a CCIP, or Contractor Controlled Insurance Program. This time, we as the GC were in the driver’s seat. We bought the policy, which gave us more control over safety programs and claims management. The name says it all: it’s about who is controlling the insurance.
What Coverages Are Included in a Wrap-Up? (Usually CGL & Workers Comp, Sometimes Others)
The Policy That Covered Me, But Not My Truck
As an electrical subcontractor, I was enrolled in my first wrap-up for a new stadium project. I was told the program covered my liability and workers’ comp, so I didn’t have to worry about those. On the third day, one of my guys backed our work van into a stack of expensive materials. I tried to file a claim with the wrap-up administrator and was immediately told no. The wrap-up covers our work and our people, but it does not cover our vehicles. Our own commercial auto policy had to pay for that mistake.
Benefits of Wrap-Ups: Potential Cost Savings, Higher Limits, Controlled Claims
The Developer’s Secret Weapon
A developer friend of mine was building a $200 million resort. She chose to use an OCIP (wrap-up). She told me it was her secret weapon. First, by buying insurance in bulk for the entire project, she saved nearly 20% compared to what the subs would have paid individually. Second, she was able to get a massive $50 million liability limit that protected the whole project, far higher than any single sub could get. Third, when an accident happened, her dedicated claims team controlled the process, not a dozen different insurers.
Challenges of Wrap-Ups: Administration, Excluded Contractors, Off-Site Coverage Gaps
The Headache Behind the “Simple” Solution
We enrolled in a large OCIP for a condo project, and it was an administrative headache. We had to spend weeks enrolling every single one of our subcontractors and their employees into the wrap-up software. The plumbing contractor, who had bad prior claims, was excluded from the program, so we had to manage his separate insurance. Then, one of my carpenters got hurt at our own shop while pre-fabricating wall panels for the project. The wrap-up wouldn’t cover it because the injury didn’t happen on the job site.
Does a Wrap-Up Eliminate the Need for Subs to Have Their Own Insurance? NO! (For Excluded Operations/Limits)
The Job Was Over, But the Lawsuit Was Just Beginning
My plumbing company worked under a wrap-up policy for a large hotel project. The policy covered us while we were on site. Three years after the hotel opened, a pipe we installed failed, causing a massive flood. We got sued, but the wrap-up policy had expired. What saved us? Our own annual insurance policy. It’s designed to cover our “completed operations” forever. A wrap-up is temporary protection on one job; your own policy is permanent protection for all your work, everywhere. You absolutely need both.
How Wrap-Up Deductibles and Claims Handling Work on Large Projects
The $100,000 Deductible I Didn’t Have to Pay
An electrician on our project made a mistake that caused a small fire. The damage was $150,000. Under a normal setup, his company would have filed a claim and paid their $5,000 deductible. But on our wrap-up project, the process was different. The claim was handled by the project’s central risk manager. The wrap-up policy had a huge, $100,000 deductible. But that deductible was the responsibility of the project owner who bought the policy, not the subcontractor who caused the fire.
Comparing Wrap-Up Administrators and Insurance Carriers
The Software That Made the Difference
Our GC firm was choosing a wrap-up program for our next big project. We got two quotes from major carriers with identical pricing and coverage. We chose the one that used a specific third-party administrator. Why? Their software. Their online platform for enrolling subcontractors and tracking payroll was incredibly user-friendly and streamlined. The other was clunky and outdated. We knew the administrative burden of a wrap-up is huge, so we chose the partner with the better technology to make our lives easier.
My Experience Enrolling My Company in a Large Project OCIP
The Mountain of Paperwork for Peace of Mind
When my small electrical company got a subcontract on a new hospital wing, we had to enroll in their OCIP. The enrollment packet was 50 pages long. We had to provide payroll estimates, past safety records, and employee details. It was a mountain of paperwork that took me and my office manager a week to complete. But once we were approved, it was a huge relief. I knew my company was now covered by a massive, multi-million-dollar liability policy that I could never have afforded on my own.
Understanding Coverage Gaps Between Wrap-Up and Contractor’s Own Policies
The Stolen Tools and the Uncovered Claim
My carpentry crew was working on a high-rise project under a wrap-up. We left our tools in a locked job box on site, and they were stolen overnight. I tried to file a claim with the wrap-up administrator. They explained that the wrap-up only covers liability and workers’ comp. It does not cover our own property, like tools and equipment. Luckily, we had our own annual Inland Marine policy, which is designed to cover tool theft. It was a perfect example of a coverage gap that our own policy had to fill.
Qualifying for a Wrap-Up Program: Project Size and Duration Requirements
“Sorry, Your Project Isn’t Big Enough”
As a General Contractor, I was starting a new, $30 million apartment building project. I thought it would be a perfect candidate for a CCIP (a wrap-up I would control). I called my broker to get it set up. He came back with bad news. The insurance carriers he worked with had a minimum project value of $50 million to even consider writing a wrap-up. The administrative costs and complexity just didn’t make sense for them on a smaller project. We had to use the traditional insurance route instead.
Protecting Yourself When Working Under Someone Else’s Wrap-Up Policy
Read the Manual!
Before my company starts work on any project with a wrap-up, I make my project manager read the entire wrap-up insurance manual cover to cover. This book is our bible for the job. It tells us exactly what is covered and what isn’t. It details the specific safety procedures we are required to follow. Most importantly, it outlines the exact protocol for reporting an accident or injury. Following those rules to the letter is the only way to ensure we stay protected under someone else’s policy.
Wrap-Up Insurance: Centralized Protection for Complex Construction Ventures
One Conductor for an Orchestra of Contractors
A major construction site is like an orchestra, with dozens of different subcontractors playing their part. A traditional insurance setup is like having every musician play from a slightly different sheet of music—it’s chaotic. A wrap-up policy is like having a single conductor for the entire orchestra. It puts everyone on the same page, under the same rules, with the same high level of protection. This centralized control and coordination is what allows a complex construction venture to create a beautiful, finished symphony of a building.
Dedicated Project Limits vs. Shared Practice Policy Limits
The Project with Its Own Pot of Gold
As a subcontractor, my annual liability policy has a $2 million limit. If I have a big claim on one job, that limit is reduced for all my other jobs for the rest of the year. It’s a shared pot of money. But when I work on a wrap-up project, that project has its own dedicated, massive pot of gold—say, a $50 million limit. A claim on that project only affects the project’s pot. My own insurance pot remains untouched, ready to protect me on all my other work.