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Construction risk managers should focus on preventing water damage

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Construction risk managers should focus on preventing water damage

NASHVILLE, Tennessee — Risk managers in the construction industry need to redouble efforts to prevent water damage during building projects, speakers urged during the International Risk Management Institute Inc.'s 34th Construction Risk Conference in Nashville, Tennessee.

Scott Foyer, Hartford, Connecticut-based national construction practice leader for inland marine with Travelers Cos. Inc. on Wednesday said water damage is the leading cause of damage at construction sites.

“Water damage has a huge impact,” Mr. Foyer said during a presentation, noting that claim severity for water losses tend to go up alongside the number of fittings in a structure. “The average loss is now $147,000” per claim, he said.

In addition to severity, there are several factors driving water damage claim frequency, said Peter Wilcox, risk control technical director for inland marine with Travelers. Changes in construction practices, a lack of skilled labor and changes in the type of pipe and how it is connected, all contribute to the problem, Mr. Wilcox said. “Now there is a lot more use of crimping tools to connect pipes than there is the sweating pipe,” he said.

Another factor is a lack of specific codes and regulatory standards regarding how to prevent water from moving through a building, Mr. Wilcox said. “We have codes for smoke and fire, but none for water,” he said.

To avoid water damages, Mr. Wilcox said, risk managers can apply three primary mitigation approaches: avoidance-based, reactive-based and preventive-based. Avoidance and reactive approaches, which rely on the purchase of insurance and manual monitoring of leaks, respectively, can be costly and unreliable, Mr. Wilcox said.

Accordingly, he suggested risk managers consider the preventive approach, which is predicated on a comprehensive water damage prevention plan that incorporates elements such as building design, control over water sources, quality control and testing.

“It's important to think from a design perspective what we can do if water does leak,” Mr. Wilcox said.

Moreover, he said risk managers should understand how remote alarm sensors can be used for leak detection and also craft a detailed response plan.

Mr. Foyer also suggested that contractors assemble an emergency response kit featuring industrial pumps, vacuums, fans and absorbent materials to be kept on-site. Such a kit could cost as little as $2,500, Mr. Foyer noted.

“Reducing your exposure to loss actually makes economic sense,” he said.

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