An opportunity to improve your risk profile.

This article explains why it is necessary to inform Unimutual early on for some construction or refurbishment projects, under what circumstances it is necessary to do so, and what information we need.

The issue

When working on new construction or refurbishment projects, planners, architects and engineers typically pay sufficient attention to meeting code requirements, particularly around life safety. But using best practice to address property risks is also important, especially for high-valued equipment or where key services could be interrupted.

A new construction or refurbishment project is often covered by a Contract Work policy whilst in progress, but while this insurance covers the area being worked on, it provides only limited cover for exposed existing facilities which can be at risk from the work. When a new building or project is completed, Unimutual will take on the risk – and that includes any risks not adequately considered during the design and construction phases. For that reason, we ask that members discuss major projects with us so we can review the risk control measures to be incorporated in the design at an early stage and if necessary have input into any aspects posing risk exposures.

The opportunity

If risks (beyond those of life safety compliance) are not considered at an early stage, they can later become the subject of a risk mitigation recommendation – either as a result of a risk assessment after handover or worst case as a result of a loss. If appropriate measures can be identified in the design phase or in even in the early stages of construction, it is more cost effective and efficient to address issues at those stages rather than as a retrofit which will typically be at higher cost.

Use of higher risk construction materials or design can, in the longer term, adversely impact a Member’s risk profile. Incorporating best practice for new facilities will also either help maintain or improve the risk profile of the site over time

How significant should a project be to trigger review with Unimutual?

As a rule of thumb, Unimutual should be consulted for new facilities or refurbishments with a project value greater than $20 million. Even if an individual project value is less than $20 million, we would ask that a member also contact us if the completed works will involve:

• The use of Aluminium Composite Panel (ACP) cladding, expanded polymer-based insulation materials, or timber (including laminated timber)
• The use of a Performance Solution for building compliance
• Where there will be Controlled Environment (CE) housing equipment or stock with a value greater than $5 million
• Where the facilities will house a higher hazard occupancy such as laboratories or animal houses
• Where the works are part of a larger master plan, in which case we would like to discuss the implications of the long-term impact of the plan on the site’s risk profile

Even if an individual project does not meet any of the above criteria, there are some changes that could impact a member’s ongoing risks, in which case please contact us to discuss the proposals and risk mitigation measures. Examples include:

• The area will house a high-valued piece of equipment
• Where plastic ducting and /or scrubbers (such as for corrosive fumes) are involved
• Where a new facility or refurbishment involves a significant sub-grade level
• The installation of PV panels
• Controlled Environments (CEs)
• Glasshouses
• Animal houses
• Student accommodation
• Where the facilities are exposed by bushland or involve potential stormwater inundation

If your project meets any of this criteria, please let us know early on and let us help you review the risks involved. To enable a risk review, the following information should be provided:

1. Description of what the project will involve
2. Drawings showing the layout, construction and fire protection. If at the initial design stage, are concept drawings available?
3. Fire Engineering report if available
4. Hydrology reports if available

If you have any concerns, irrespective of the size of the project, Unimutual is available to support your risk management needs.

Flowchart

If you have a construction project planned or started, use the following flowchart to determine your next steps:

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