Construction Risk Management: Minimizing Risk & Staying safe

construction worker thinking

Construction sites are inherently risky places. That’s why it is essential that everything possible is done to reduce the number and severity of potential accidents. When workers remain injury-free, the project itself can be completed on schedule. 

With the potential for accident or injury always in effect, it is absolutely necessary to have a good risk management plan to help reduce the risk factors at a construction site. The foundation of any good risk management plan at a construction site is using easy-to-follow, sound, and safe processes. 

Today, we’re going over everything you need to know about construction risk management. We’ll start by defining what construction risk management is and why it is important. Then, we’ll explore some of the most common risks and how they can be prevented. Let’s take a look!

What is Construction Risk Management?

Before we explore the risks associated with large construction projects, we need to define risk management

Construction risk management is the process of identifying, assessing, and mitigating potential hazards that could impact a construction project. This includes a wide range of risks, such as safety hazards, financial risks, environmental impacts, and delays due to unforeseen circumstances. 

By identifying these risks in the planning stage, appropriate strategies can be developed to prevent, mitigate, or transfer these risks. This might involve implementing safety protocols, securing sufficient insurance coverage, or including contingency plans in the project timeline.

Why Is Construction Risk Management So Important?

Without proper risk management, your site will become costly and dangerous to your workers

safety precautions on construction site

Construction risk management is crucial for several reasons. First, it ensures the safety and health of workers and the public. Proper risk management also safeguards financial resources. Construction projects typically involve substantial investments. Cost overruns due to unforeseen complications, delays, or poor-quality workmanship can significantly increase the cost of a project, potentially leading to financial loss.

Additionally, a well-managed risk management process can enhance stakeholder trust and reputation. Stakeholders, such as clients, investors, and community members, want assurance that their interests are being properly managed. When your team and projects maintain a great reputation for risk management, you will build an excellent reputation in your local community.

What are Some of The Common Risks Found on Construction Sites?

There are innumerable risks associated with any type of construction

crane lifting heavy material

Every construction company deals with risks—that’s why having the right risk management tools will help your business identify dangers. Some of the risks that are normal and occur regularly include issues associated with high winds, inclement weather, scaffolding, and crane use. Let’s take a look at some of the most common risks found in construction and the steps you can take to avoid any injuries or setbacks.

Avoiding Ladder Accidents

Injuries from ladder accidents will keep you or your employees out of work for quite a long time. To prevent any ladder-related accidents from happening, be certain that the right ladder is being used for the right job. Once a ladder is chosen, it should be carefully inspected by a professional. If a ladder is defective in any way, it needs to be clearly labeled so that no one uses it. Then, it should be immediately repaired or removed from the site.

Some of the most common signs of a defective ladder include missing rungs and damaged side rails. If an accumulation of grease or dirt residue is visible on its surface, a ladder is not safe to use. Another potential problem could be the presence of stickers, paint, or anything else that might cover a defect.

Other important details to ensure construction site safety include the length and weight capacity of a ladder. Always ensure that a ladder is long enough to get a worker to the intended area safely. It’s also important to remember that the manufacturer’s recommended weight capacity for a ladder should not be exceeded.

Preventing Construction Site Falls

Falls are common hazards on construction sites, but that doesn’t make them inevitable. If you want to maximize your insurance and risk management, then fall prevention is a great place to start. Be sure that no area of your site is unstable, and use guardrail systems when necessary. Scaffolding should always be fully planked, and scaffolds must never be used in bad weather. Floor holes should be covered, and safety nets, body harnesses, and other tools should be used to help minimize your site’s risk.

Exercising Caution in Stairways

A stairway can be the scene of a nasty accident without proper precautions. No work materials or miscellaneous objects should be present in a stairwell. Anything that causes a stairway to become slippery should quickly be cleaned and dried. It is always a good idea to use stairway treads and railways to help minimize slips and falls in the stairway.

Staying Safe In and Around Trenches

Trench collapses can lead to fatal injuries. That’s why it is extremely important to have a protective system around trenches for worksite safety. In fact, workers should avoid entering any unprotected trench. Many site managers employ a registered engineer to help create a protective system. Regardless of the system you have in place, make sure you take some time to inspect it for flaws.

Staying Careful With Forklifts & Cranes

Workers must always take extra care around forklifts and cranes. Neglecting to do so can yield disastrous results. Those who operate such equipment should always have the proper qualifications and safety certifications. 

All specialty construction equipment should be carefully inspected before each and every use. Defects in forklifts and cranes need to be addressed as soon as possible. After that, appropriate procedures must be followed in order to prevent any accidents from occurring.

Averting Chemical Accidents

Relevant chemical safety information on each material at the site should be carefully reviewed by workers. Setting up easy access to this information is essential to ensure worksite safety. Confirm that each member of your team understands what to do in case of an accident, from cleaning up spills to proper safety after handling.

Preventing Electrical Mishaps

Workers should always know how to implement electrical safety precautions. Electrical cords that are worn or damaged in any way must be replaced immediately. A trained professional should inspect any damaged electrical equipment. All defects need to be reported and repaired before the electrical cord is used in any way. 

No matter where you are on the site, always make sure you know where power lines are positioned, keeping ladders and scaffolding at least 10 feet away at all times to prevent an accident.

Inclement Weather

Construction happens in all kinds of weather. Knowing how to work safely in wet or inclement weather can help reduce the chances of equipment failure, injuries, or even loss of life.

For example, if a hurricane or other major storm is set to make landfall around the Mid-Atlantic coast, areas up and down the entire East Coast will feel the storm’s effects. Hazards such as rain, lightning, high winds, and cave-ins/landslides pose serious safety risks to workers and equipment. For those directly in the storm’s path, steps should be taken to secure your site/property/equipment best to minimize any potential loss.

Download OSHA’s Lightning Storm Safety Fact Sheet

How to Prevent Accidents With Proactive Construction Risk Management

When you take account of every possibility on your construction site, you set yourself up for success

construction team reviewing plans

While it is impossible to identify every possible risk associated with a construction project, a genuine effort should be made to list each source of danger. Using a systematic approach, you should begin with all the various categories of risk associated with a typical construction project. Occupational risk should be the category at the top of your list as it involves the safety of everyone on the site. Let’s take a look at the steps you can take to assess a construction site and evaluate the risk factors for every possible scenario.

Prioritize Possible Risks

Once you’ve categorized the risks and broken them down into individual sources of construction site danger, you determine which are the most important. This will help your team decide how much time and effort you should devote to overcoming potential dangers. If you don’t have a priority system of your own, two of the most commonly used methods for prioritizing risk are the likelihood of a risk actually occurring and the potential impact of any given risk on your business.

This ranking system places those risks at the top, which have both a huge impact on your business and a higher likelihood of occurrence. By listing all the risks you’ve identified in this kind of priority ranking, you will have a clear indication of which risks need to be addressed first.

Manage Each Risk Accordingly

Managing each of the priority risks you’ve identified is not a one-size-fits-all process. For instance, you may want to avoid the risk altogether if a project occurs at a time prone to severe weather. 

Depending on the project, you might be able to offload a portion of the risk involved in a construction project by securing insurance. Getting an insurance policy reduces your own liability in the event of deadline failure or some other cause of incompletion.

Reducing risk is the one way that you have the most direct control over the proper use of safety equipment and training for those on a construction site. In some cases, you might decide to manage the risk by simply accepting the risk. For example, if your project is underway during a season of bad weather, you might decide that continuing construction is the best possible course of action.

Secure Risk Management Resources

Now that you’ve identified all the risks on your construction site and you’ve determined which approach you will use, you have to allocate resources to your risk-management approach. For risks such as cost overruns, the resources are an additional source of funding. As mentioned previously, obtaining insurance is a great resource for managing financial risk on a project. 

Construction software can also be used for achieving the safest building design and managing the associated risks. There are also other kinds of new technology that can reduce risks on-site by providing new methods of accomplishing old tasks. Pre-fabricated building sections are a great example of this type of technology. These pre-fabricated pieces not only save time and help meet deadlines, but they reduce the number of tasks that workers are obliged to do manually.

Get Everyone On Board

Perhaps the most important single way of improving your risk management plan on a construction site is to ensure the participation of all parties involved. When it comes to new safety policies, you should make sure that the message gets out to everyone on site.

Updates and reviews on the project should include everyone and should address risk management of all relevant factors. Own your risk before it owns you, and contact Gallagher Crane Team today.

How to Find the Best Risk Management Services

Feel confident that you have the right amount of protection for your construction projects

Specialty risk services are important for your construction business as they provide additional understanding of how to navigate the world of risk management. Understanding what your business needs in terms of construction risk insurance is important. You don’t want to be either underinsured or overinsured for your upcoming project.

In order to determine what risk management tools are right for your company, hiring the right specialty risk services company like Gallagher Crane Team will take the burden of assigning risk off your shoulders.

A great risk management company will act on your behalf and help assign risk to each project so you are never burdened with risks that aren’t rightfully associated with your business. For example, your construction company should never be assigned a risk that belongs to the architectural firm. If something happens as a direct result of design, the last thing you want is to have it billed to your insurance.

A good specialty risk services provider will encourage you to have waivers of subrogation, allowing risk to be transferred under contract specifications. This will protect your company from certain losses. This risk management tool is one you should go over with your risk management specialist. 

Stop worrying about your risk on the construction site. Be prepared and take a proactive approach to tackling risk head-on with help from Gallagher Crane Team. Own your risk before it owns you, and contact Gallagher Crane Team!

*Gallagher does not deem this blog entry as a complete and thorough listing or overview of the above topic and does not recommend it be primarily relied on. It only highlights some common issues and resolutions. For a thorough overview, please contact Gallagher’s Risk Engineering Division.

This message is to be used only for general reference purposes. It summarizes certain publicly available information, but it is not legal advice, and Gallagher Crane Team disclaims any representation or warranty that the materials contained herein are accurate. Gallagher Crane Team is not a law firm or accounting firm and does not provide legal or accounting advice; you should engage your own lawyer or accountant if you have questions about these materials. Gallagher Crane Team does not deem the above information and any attached documents as a complete and thorough listing or overview of the above topic and does not recommend it be primarily relied upon as such. It only highlights some common issues and resolutions.