Wrap-Up Insurance Program
A consolidated insurance program covering all contractors on a construction project under a single set of policies, either owner-controlled (OCIP) or contractor-controlled (CCIP).
What It Is
A Wrap-Up Insurance Program (WIP) is a consolidated insurance arrangement that provides coverage for all or most parties involved in a construction project under a single set of policies. Instead of each contractor and subcontractor carrying their own separate CGL, workers compensation, and excess liability policies, a single wrap-up program covers everyone.
There are two main types: Owner-Controlled Insurance Programs (OCIP), where the project owner purchases and controls the insurance, and Contractor-Controlled Insurance Programs (CCIP), where the general contractor controls the program.
Wrap-ups typically include CGL, workers compensation, excess/umbrella liability, and sometimes builders risk and professional liability. The enrollment process requires each enrolled contractor to deduct their insurance costs from their bid and comply with the wrap-up's safety requirements.
Why It Matters for Brokers
Wrap-up programs are increasingly common on large construction projects ($50M+) because they can reduce total insurance costs by 1-3% of construction value through volume purchasing, eliminate coverage gaps between contractors, provide uniform limits and coverage terms, and centralize claims management. For brokers, wrap-up placements are complex but highly valuable engagements that require specialized expertise in construction risk and program design.
Real-World Example
A hospital system developing a $180M medical campus implements an OCIP that enrolls the general contractor and 85 subcontractors. The OCIP provides $2M/$4M CGL, statutory workers compensation, and $50M excess liability for all enrolled parties. By consolidating coverage, the hospital saves approximately $3.2M compared to what each contractor would have charged for insurance in their individual bids, while ensuring consistent coverage and centralized safety management.
Common Mistakes
- 1Not properly managing the enrollment process, leading to contractors who are supposed to be covered under the wrap-up but never completed enrollment and have a coverage gap.
- 2Failing to verify that enrolled contractors actually deduct insurance costs from their bids — some contractors bid as if they're carrying their own insurance, eliminating the cost savings.
- 3Overlooking completed operations coverage after project completion, which is essential because construction defect claims can arise years after the wrap-up program expires.
How brokerageaudit.com Handles This
Document Processor handles wrap-up enrollment forms, insurance cost deduction calculations, and coverage verification for enrolled contractors. The system tracks enrollment status across all project contractors and flags any parties who haven't completed the enrollment process.