Study on Insurance Proposal Forms in Construction

Abstract

Insurance is one of the most widely used mechanisms of transferring risk from one party to another in exchange for a premium. Current insurance proposal forms use in Sri Lankan construction, do not provide much space to open up to the insured. Hence, this research attempts to explore the current insurance proposal forms and propose a new proposal form much relevance to the nature of the Sri Lankan construction. Contractors All Risk (CAR) insurance is the main focus of the study since it is the one of the most commonly used insurance in Sri Lankan Construction industry other than the Erection All Risk Policy and Workmen Compensation Insurance Policy. This was approached through data collection modes such as pilot survey, detail questionnaire survey and expert interviews. The composition of current insurance proposal forms identified through pilot survey and findings were revealed that there is no unique format within the insurance proposal forms and they have their own set of questions which differ from each other, while showing some similar characteristics randomly. None of the proposal form reflects all the characteristics observed through different proposal forms. Covers and issues of current CAR policy from the perception of the construction and insurance professionals were gathered through the detailed questionnaire survey. Thereafter, a new proposal form was developed, in much comprehensive manner to address identified prevailing issues using expertise ideas together with broad literature observations to provides much space to open up to the insured.