Business Toolbox Tip #5: 3 Valuable Tools that Actually Help Reduce Business Risk
The Problem: You realize that you have a lot at risk if something goes wrong in your construction company.
The Zone – Zone 2: Insurance and Risk Management
When you first get started with your construction business the sky’s the limit. You have grand plans for building a grand company. Or at least building a small company that helps support you and your family.
In the beginning everything is about potential. There is no where to go but up! As business grows you start to accumulate things. You build up a nice collection of equipment. You have good employees. The construction company has a strong customer base that keeps you in the work.
As you continue to grow it begins to dawn on you. No, actually it hits you more like a linebacker coming from your blindside. You now have something at risk. You have assets. The game has changed.
It is no longer a thought of “What have I got to lose?” It is now a realization that you have a lot to lose and as a result a lot to protect.
So how do you move to protecting your company, your assets and your family?
Here are three tools that can help reduce risk in your construction company.
Keep in mind that this is not legal advice or insurance advice. These are suggestions based on years of experience in the construction industry.
- Meet with your insurance agent on a regular basis. When was the last time that you sat down and actually went over your coverages with your insurance agent? Are you one who only sits down at renewal time? Make time to sit with your agent on a regular basis and make sure that your coverages are sufficient to protect you and your business.
- Establish standard contracts. The days of a handshake are long gone. Create standard contracts and contract language that governs your company’s standard transactions. Company to customer. Company to sub-contractor. Make sure that you are adequately protected. A qualified attorney with experience in the construction industry can advise you in how to best set these agreements up.
- Consider bringing on a risk control advisor. There are risk control professionals who specialize in helping contractors in the construction industry manage their risk exposure. They help with important stuff like safety on project sites as well as other aspects of your business which can impact the future of your company.
Risk is a part of owning and running a construction company. Risk cannot be eliminated, but it can be managed. Learn how to best handle risk. Managing risk is a part of leading in the construction industry.