Litigation Construction Companies Versus Insurance Companies

When do i need a lawyer

Construction companies. Lawyers. Arbitration. Builder’s risk coverage. Insurance companies failing to uphold agreements. These are some of the issues that befall what is generally considered to be a smooth process: the building of a site. That site can be a high rise building or a small library. Either way. There are issues.

Construction companies have a choice when they start to build a construction site: Get insured or don’t get insured. Construction companies that get insured go with the builder’s risk coverage, which is a liability coverage lasting between 12 and 18 months. The liability coverage covers damages to the property due to natural or human events.

These events can include vandalism, winds, hail, downpour, hurricanes, tornadoes, fires, and other forms of damage that can halt production and possibly deter the building at that location. And in some cases, the insurance companies will not uphold claims. This leads to a court case, and arbitration.

There are some statistics surrounding construction companies and insurance companies. There are some statistics surrounding builder’s risk coverage as well. They are:

  • Builders risk coverage is written for a minimum one-year term to cover a new building or structure under construction or an existing structure undergoing additions, alterations, or repairs.
  • ISO?s Builders Risk Coverage Form, CP 00 20, is the basic avenue to builders risk coverage in the simplified language commercial property program.
  • In 2015, the American Arbitration Association administered 551 construction industry cases with claims of $500,000 or more. The largest mediated construction case was for $2.6 billion, while the largest arbitration case was $96 million. The total value of all claims and counterclaims in 2015 was $5.5 billion.
  • According to the American Arbitration Association, alternative dispute resolution (ADR) is the preferred conflict-management process in the construction industry. The median time frame from filing to award for 2015 construction arbitration cases was just 232 days, or less than eight months.
  • According to the American Arbitration Association, the largest case resolved by one arbitrator was a claim of $232 million. The smallest case (which was resolved by a panel of three arbitrators) was a claim for just $23,000.

Commercial construction companies face these risks every day. Of vandalism, of property damage, of natural resource damage. All of these things can delay a construction site’s progress, to put a crippling on that ability for a building to be built. Insurance companies may dispute a claim. There are many reasons for that.

Their are certain law firms that represent construction companies. Although this is not a large percentage of lawyers or people within the law field, this percentage of lawyers represents corporations that are struggling against insurance companies, which are well-funded as well.

The dispute over property is critical. Sometimes a property is damaged but only slightly. There are some cases, however, where property damage is so extensive is that it causes a halt to construction. It can cost millions or even hundreds of millions of dollars worth in damages.

Some of these may be residential complexes, but they may also be large scale commercial property developments or large scale industrial developments. In all of these locations, damages can get into the hundreds of millions. Sometimes insurance won’t cover these, citing a different interpretation of the coverage.

Lawyers for construction companies advocate for their client in the courtroom and during arbitration. Lawyers for construction companies are hired for their ability to negotiate and fight back against the lawyers for the insurance companies. They can help a construction company but the process may be difficult.

Lawyers for construction companies will likely be experienced if they are going to do the job well. They will likely have strong educations with experience fighting in the courtroom for different clients. Lawyers for construction companies represent companies that are worth hundreds of millions if not billions of dollars.

There are many terms for this. They include, when do I need a lawyer, when should I consider an employment law firm, when to make an appeal, litigation attorney, making an appeal in court, when do I need a construction attorney, why does my business need an attorney, and more.

There are many ways in which a construction site can be damaged. There are natural causes, such as fire and wind and rain. There are human causes, such as vandalism and general destruction.

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