Where it all started

When Kier Construction started working with Jones, they were confident they were already in good shape.

However, once the Jones COI experts reviewed Kier’s subcontractor insurance docs and posted the results in the company’s Jones account for the first time, Kier’s team was in for an unpleasant surprise. Their actual compliance rate was below 7 percent.

Sandy Rex, a lead project administrator at Kier, explained what the issues were (00:55 clip):

Note: Jones manages the collection and review of subcontractor insurance documents to help GCs protect themselves from insurance risk. Want to learn more? Talk to our team of experts today!

Let’s Chat!

Some of the coverage issues that Kier team had been missing were:

  • Privity language on the endorsements
  • “Wordsmithing”—exclusionary or limiting verbiage that Kier team had no experience with, and therefore hadn’t been able to catch before Jones stepped in.

Note: interested in exploring how Jones can help you automate your compliance management end-to-end and de-risk your buildings? Talk to our team of experts today!

Let’s Chat!

Setting Compliance Goals and Tracking Progress

Sandy knew the team needed to get subs in compliance quickly. The company set the goal: 85 percent compliance. It reduced the risk to an acceptable level and, at the same time, was realistic.

In order to stay on track and keep compliance top of mind for the team, Sandy started a weekly meeting called “Compliance Mondays.” The team would look at Jones’ reports, check the weekly progress towards the goal, and go over their “problem children”—subcontractors that failed to respond to requests for COIs or struggled to meet insurance requirements.

Sandy also established an intermediate goal for her team to celebrate a progress milestone: 75 percent compliance. Kier team knew that once they reached this milestone, they would go out for an official pizza and bowling celebration. Sandy had a tracker where she would update daily progress that her team could follow, and this gamification tactic helped keep everybody on track.

Collection: Getting Insurance Documents From Subcontractors

Having all certificates of insurance on file is the foundation of achieving high insurance compliance. In reality, some companies struggle to reach unresponsive subcontractors.

Obviously, having Jones handle the collection of insurance documents helps. However, there are still a couple of things our customers can do to expedite the results—which is exactly what Kier Construction did.

The team:

  • Checked and updated the contact information for every subcontractor and their broker, ensuring that Jones has the correct emails on file.
  • Sent an introductory email to all vendors letting them know they would be seeing emails coming from Jones and that they were not spam.
  • Leveraged the integration with Procore. This enabled the field team to request insurance from subcontractors without having to switch between the tools. The clip below shows how:

Resolution of Coverage Issues

In general, Kier team, by their own definition, is a big sticklers about what their insurance requirements are.

Here are three coverage issues that the company would sometimes waive:

  • Certificate Holder address. Occasionally, a sub would send a COI with the old Kier address listed on it. Kier team doesn’t feel that this issue poses too much risk, so they would waive it, making a note to correct the address upon renewal
  • 30 Days’ Notice of Cancellation. While still a coverage issue, Kier team feels it is a minor one, so they wouldn’t hold payment over it.
  • Notice of Completion. Depending on the scope and type of work (e.g. what wouldn’t be carried over into the warranty period), Kier team would waive Notice of Completion.

Sometimes, when a sub is at an impasse with some requirements, Kier team would consider alternative remedies, which also depends on the scope and type of work.

For example, if a subcontractor struggles to meet the All Hired and All Owned Auto liability requirement, Kier team will let them sign a form stating they won’t drive their vehicle on-site. Instead, a sub must park down the street and carry their tools.

Enforcing Compliance Rules

One of the most interesting parts of the webinar was the part where we discussed enforcing the rules. What happens when a subcontractor threatens to walk off the job site because their payment is being held over an insurance coverage issue?

Here is what works for Kier:

  • Hold list for subs prevents payments from being released (stated in Kier’s contracts)
  • Weekly “Compliance Meeting” or other recurring time when compliance is reviewed at the management level.
  • Buy-in from senior leadership.

One of the mechanisms that help Kier enforce compliance is their multi-level proactive communication system. For example, subcontractors are required to sign an acknowledgement form before they are even allowed to bid, plus insurance requirements are listed in their contracts.

Results

In less than six months, Kier Construction made the following progress with their third-party compliance:

  • 99.5 percent document collection rate
  • 24.6 percent increase in compliance
  • Around 90 percent overall compliance

Watch the full webinar recording: