ECIC predicts perfect storm as construction skills demand strips supply heightening claims risk as non-skilled workers fill the gap

The rise in ECIC’s policyholder wage bill is in line with figures from the Royal Institute of Chartered Surveyors, (RICS), which reported recently that building companies have seen the net balance of workloads leap 5 per cent during the first quarter of the year to a high of 43 per cent compared to levels in the fourth quarter of 2013.

Phil Scarrett, sales and marketing director for ECIC said: ‘Construction companies are already having to juggle the opportunities that are coming thick and fast. Along with a retained workforce using sub contractors is an attractive option as it solves a skills shortage fast. However, it does bring with it a heightened risk of defects and a lack of sufficient insurance cover if the sub contractor does not have the relevant, or enough, cover in place. Furthermore, some firms will be tempted to bring in unskilled labour which has its own inherent risks.

‘We would encourage any construction company looking to hire sub contractors in this current upturn to talk to their broker to ensure that all their policies and cover are in good shape before entering into any contracts, and to ask that the sub contractor do the same before signing on the dotted line.  The temptation to employ unskilled help is understandable but the risks might well outweigh the benefits.’

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