Construction and Allied Trades



Building a strong defense against construction risk.

Insurance and risk management is an integral part of a construction business.  So many times, construction business owners focus on production and cost savings and miss huge job site issues that could cause serious injuries to their workers or others.  In the spirit of “just get it done”, business owners don’t take the time to read their construction contracts.  This leaves them open to uninformed and unintended breach of contract and pay issues that are costly.


Become an avid reader of contracts.

Our insurance firm has a full-time attorney to provide legal advice relating to the contracts of our clients. We have saved our clients tens of thousands of dollars when jobs “went bad” and the general contractor was let go.

I see many contracts requiring coverage beyond what an insurance policy will offer.  These sections in a contract can become costly to your business and in certain situations cause a major disruption to your business continuation.

Be an avid reader of the contracts you sign.  You will sleep better at night. 


He who has the cash, wins.

I attended a contractor association meeting one year when a large general contractor said “He who has the cash, wins!”  There are a lot of great general contractors in the Mid-Atlantic region that don’t misuse or abuse the payment terms between them and their subcontractor.  Unfortunately, there are others that use the subcontractor payment system to their benefit.  To minimize the delayed or non-payment risk, all relationships need to be treated equally in order to minimize the outstanding receivables.  Having consistency in the accounting department should lower the risk of late or non-payment.  

What would you do to get paid?  Would you accept responsibility for something you had nothing to do with? Would you forget about a change order?  Resist the temptation to lay aside your core business principals to receive your monthly draws.

Subcontractors are regularly offering interest free financing for projects they are working on.  Start reviewing your contracts and begin negotiating payment terms to suit you.  I would also encourage you to rate each general contractor based on payment history and apply standard debit factors to each quote given. Those that pay promptly, get the best price.  Those that don’t, get a higher price to cover the time value of money on the delayed payments.  A system of including payment history to your proposals will cover the costs associated with delayed payments.


CFMA – Construction Financial Management Association

The CFMA is an organization established for the construction business owner to help them do a better job in managing the profitability and cash flow in today’s challenging construction environment.  I see value in the organization and offer educational services as it relates to insurance and risk management to the local chapter.  To know more, check out the association at