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Are you planning to include a school construction bond on the ballot to address your needed school facility, technology and infrastructure upgrades?

Then you should consider an Owner Controlled Insurance Program (OCIP) to ease the school construction frustrations faced by many districts.

According to Kris Olafsson, Deputy Superintendent for El Monte City School District, he initially started using ASCIP’s OCIP for his school construction projects “to ease the administrative burdens” of monitoring all of the construction contracts and verifying the insurance limits of the contractors and their subs were adequate and current throughout the project.  The high coverage limits also provided assurances that if a significant accident happened, there would be adequate coverage.  But then he discovered that the OCIP provided a safer construction zone for students, parents, staff and the public.  The OCIP program has more defined safety parameters with cleaner, safer construction sites.  He also discovered that he was better informed on his construction projects, and the quality of the bidders was much better.

With the rapid growth occurring in the Central Valley, Clovis Unified School District is undergoing numerous school construction projects.  Michael Johnston, Associate Superintendent for Clovis says he likes using an OCIP program to “keep projects safe.   Its great!  And when issues do arise, its assuring to know that we’ve got coverage!”  In fact, “when something goes wrong, its handled and claims are resolved quickly”.

Teresa Dreyfuss, Superintendent/President for the Rio Hondo Community College District states that her college has used the ASCIP OCIP program not only for building renovations and new construction, but also for infrastructure upgrades for her older facilities.  In addition to using the OCIP to ease administrative burdens and for safer outcomes, she also found that when a problem arises for which there is no coverage, ASCIP takes the extra steps to help resolve the issues.

In an OCIP, the school district “owns” or provides all of the various insurances needed for the construction project including general liability, workers’ compensation and contractor’s pollution, plus ASCIP Property and Liability program members enjoy additional builder’s risk coverage.  The contractors then deduct the cost of their company’s insurance premiums from their construction bid.  The OCIP program manages and controls risks within the project, providing regular safety inspections to reduce losses, claims and accidents.  The OCIP program has been so successful in controlling losses that it received lower rates during its recent renewal with its insurer.

With all of these positive outcomes, why don’t all districts use an OCIP for their school construction projects?  There are some myths about OCIPs that create hurdles.

Myth #1: Contractors find an OCIP cumbersome with additional administrative burdens.

The only additional administrative “work” is for them to enroll in the OCIP on-line, but once they are enrolled in one project, they can bid on other projects, even with other school districts, and don’t have to enroll again.

Myth #2: Is there really a cost savings?

The real savings to the district is less administrative overhead, burden and time, a reduction in accidents and losses, and finally, prompt claims handling with no disputes as to which contractor is responsible for the loss, who is going to handle the claim and are the limits of coverage adequate to pay the claim.

Myth #3:  Is the district double-paying for some of the insurance since the contractors pay the premiums upfront and secure annual coverage for all of their construction jobs?

The bid process has a mechanism that ensures the selected contractor has deducted insurance costs from its proposal thereby avoiding any duplicate costs.

With all of these positive outcomes, it makes good business sense to include an OCIP for your next multi-million-dollar school construction project.  For more information about how an OCIP can help you, contact ASCIP today.