OCIP Overview

What is wrap-up insurance

Wrap-up insurance, also known as an OCIP (Owner Controlled Insurance Program) or a CCIP (Contractor Controlled Insurance Program) is a single insurance policy providing participants in a construction project ("insureds") with coverage for general liability, and on occasion, first-party property coverage and workers' compensation risks. All participants enrolled in the program become named insureds under the wrap-up policy.

Typical coverage provided under wrap-up policies

These policies provide third-party general liability coverage for insureds' activities at the project site, including both bodily injury and property damage protection to non-project property. In addition to coverage for all participants during construction of the project, wrap-up policies typically provide completed operations protection against construction defect lawsuits matching in length the longest applicable statute of limitations in the state in which the project is constructed.

Advantages of a wrap-up policy

  • They ensure that all participants in a construction project have insurance coverage.
  • They allow owners, developers, and contractors to hire the best subcontractors for a project without having to worry about the availability of insurance coverage for subcontractors.
  • They lower the overall cost of the project by allowing contractors and subcontractors to eliminate the project from their own insurance policies.
  • They lessen the overall number of claims and allow participants to concentrate on building the project, instead of administrative or legal issues.
  • They allow project participants to avoid purchasing post-construction comprehensive general liability policies to cover completed operations exposures.

Role of the wrap-up insurance program administrator

Under wrap-up insurance policies, owners have certain contractual obligations, such as enrollment of project participants and determining which participants qualify for coverage. Program administrators assist owners in meeting those obligations. Administrators help owners understand the wrap-up process and available options in the development and administration of a wrap-up program. They then provide the managerial services that are required to manage the wrap-up insurance program, thereby freeing project owners from the burden of self-administration. Administrators also provide a centralized resource for assistance and information about the program to all project participants.

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