Effectiveness of contractors all risk (car) insurance policies in road construction projects

Abstract

An “Insurance”, is a protection against a possible eventuality, which spans through numerous sectors of different types. Since, construction industry is known to be a high risk industry; it is always obscure the extent of the insurance operations in construction projects. Thus, nnntantnrs encounter greater difficulties, when thev--pnrchase“(nsuraft4cs coverage at appropriate levels, tor all parries. Therefore, it is important to understand the real necessitate of an insurance coverage, in minimizing the latent inefficiencies and also to find out effective methods to optimize the use of Contractor’s All Risk CAR insurance policies to get the maximum use in the road construction projects. Research has adopted a simple random sampling method of the probability sampling criteria and the data were stemmed from a questionnaire survey, which addressed 150 respondents from local construction organizations. Furthermore, insurance policies together with their claims were analyzed to understand the current practice in the industry. As a result, many important findings were discovered with respect to improper procedures, drawbacks and pit holes with respecl to insurances coverage within the construction industry. Finally, it can be concluded that by preparing more project specific guidelines rather than general guidelines, potential catastrophes that can arise in the process can be mitigated. The choice of rapid road construction projects as a compound to post war socio-economic development can be identified as a timely strategy. Hence, this study will provide valuable insights directly to Sri Lankan construction industry and also its external forces.