Owner Controlled Insurance: A Complete Guide for Project Owners
When undertaking large-scale construction projects, risk management becomes one of the most critical factors to ensure the project is delivered on time, within budget, and without unexpected financial losses. One of the most effective solutions is Owner Controlled Insurance (OCI), also known as Owner Controlled Insurance Program (OCIP).
This comprehensive guide will explore every aspect of Owner Controlled Insurance, why it matters for construction project owners, how it compares to contractor-provided policies, and most importantly, why you should call Pacific Insurance, Inc. at (801) 561-5550 to protect your next major project.
What is Owner Controlled Insurance (OCI)?
Owner Controlled Insurance (sometimes referred to as an OCIP) is a specialized insurance policy that is purchased and managed directly by the project owner rather than leaving the responsibility to the contractors or subcontractors.
With OCI, the project owner essentially buys a single, consolidated insurance policy that covers all contractors, subcontractors, and parties working under the scope of the project. This streamlined approach removes the need for each contractor to carry their own individual insurance coverage for the project.
Instead of managing multiple policies with varying coverage limits, exclusions, and costs, the owner has full control over one master policy—ensuring consistency and eliminating possible gaps in coverage.
Key Coverages Typically Included in OCI
An Owner Controlled Insurance Program can be customized depending on the size and nature of the project. However, most OCIPs typically include:
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General Liability Insurance: Covers bodily injury and property damage claims arising from the project.
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Workers’ Compensation: Provides wage replacement and medical benefits for injured workers involved in the project.
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Employer’s Liability: Protection against lawsuits by employees who may claim negligence.
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Umbrella/Excess Liability Insurance: Offers additional protection above the primary liability limits.
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Builders Risk Coverage: (optional) Protects against loss or damage to the construction site, materials, and equipment.
Some programs may also include professional liability, completed operations coverage, and project pollution liability depending on the project’s complexity.
Why Choose Owner Controlled Insurance Over Traditional Contractor Insurance?
Many construction owners are faced with a common dilemma: Should they rely on each contractor’s insurance policies, or should they centralize all risk coverage under one OCIP?
Here are the primary advantages of OCI:
1. Consistency in Coverage
When contractors secure their own insurance, coverage terms vary widely. Some policies may exclude critical risks, creating dangerous gaps. OCI eliminates this inconsistency by placing everyone under the same standardized policy.
2. Cost Efficiency
Group purchasing leads to lower insurance premiums compared to piecemeal policies. It also removes the issue of contractors “padding” their bids to cover insurance costs.
3. Centralized Claims Handling
Instead of juggling claims through multiple insurance carriers, all claims flow through one program under the owner’s control. This streamlines claims management, reduces disputes, and speeds up resolution.
4. Enhanced Safety Incentives
With a unified insurance program, there is greater emphasis on standardized safety protocols. It reduces workplace accidents and can decrease overall claim expenses.
5. Greater Control for the Owner
The project owner knows exactly what is covered, who is covered, and how risks are addressed—providing maximum oversight and peace of mind.
6. Long-Term Completed Operations Coverage
Often, OCIPs extend coverage well beyond project completion, sometimes up to 10 years, protecting against defects or post-construction claims.
When Does OCI Make Sense?
While Owner Controlled Insurance offers numerous advantages, it may not be cost-effective for every project. OCI is typically ideal for:
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Large-Scale Construction Projects (generally $50 million or more in construction value).
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Projects Involving Multiple Contractors/Subcontractors where coordinating insurance would otherwise be cumbersome.
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Infrastructure Projects such as highways, bridges, airports, and stadiums.
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High-Risk Construction Projects with elevated liability exposure.
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Organizations Managing Multiple Projects that want uniformity across worksites.
Smaller projects may not justify the administrative costs involved with an OCI program, so it’s important to consult with insurance experts, such as Pacific Insurance, Inc., for tailored advice.
OCI vs. Contractor Controlled Insurance Programs (CCIPs)
A related alternative is the Contractor Controlled Insurance Program (CCIP), where the lead contractor, rather than the owner, purchases the wrap-up insurance.
The key differences are:
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Control: With OCIP, the owner manages the insurance; with CCIP, the contractor does.
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Perspective: Owners often prefer OCIP for transparency, while contractors may prefer CCIP to manage risks directly.
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Coverage Focus: Both aim to consolidate policies, but OCIP ensures the owner’s interests are prioritized from the start.
For owners wanting full visibility, risk management, and savings, OCIP is almost always superior.
The Financial Benefits of Owner Controlled Insurance
One of the biggest attractions of OCI is cost savings. Here’s where those savings materialize:
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Reduced Insurance Mark-Ups in Contractor Bids: Contractors typically factor the cost of their insurance into bids. With OCI, these are eliminated.
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Group Purchasing Power: A large consolidated policy costs less per contractor than multiple smaller policies.
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Lower Litigation Fees: Coverage disputes between insurers are minimized since claims come under one policy.
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Improved Safety Reducing Claim Costs: A unified approach to safety can prevent accidents, lowering loss experience and premiums.
In short, OCI can save millions on large-scale construction projects.
Why Choose Pacific Insurance, Inc. for Owner Controlled Insurance?
Selecting the right brokerage to design, implement, and oversee an OCI program is just as important as choosing the coverage itself. That’s why project owners across the country trust Pacific Insurance, Inc.
Here’s what sets them apart:
1. Expertise in Construction Insurance
Pacific Insurance, Inc. has decades of specialized experience in handling complex construction and infrastructure insurance needs. Their team thoroughly understands project risks, contractor involvement, and owner liabilities.
2. Customized OCI Programs
No two projects are alike. Pacific Insurance crafts tailor-made OCI plans that fit your project’s unique scope, scale, and risk profile.
3. End-to-End Program Management
From policy design and bidding assistance to claims handling and safety consulting, Pacific Insurance manages every step of the OCI process. You don’t just get insurance—you get full-scale risk management.
4. Cost Savings Strategies
Pacific Insurance knows how to negotiate aggressively with insurance carriers to secure the most competitive pricing while ensuring robust coverage.
5. Proven Track Record
With a history of successful partnerships on major construction projects, Pacific Insurance brings confidence and reliability to owners determined to minimize risk.
6. Personalized Client Service
Unlike large faceless corporations, Pacific Insurance provides a personal touch. Their expert advisors are always available to answer questions and provide clarity throughout your project.
How to Get Started with Pacific Insurance, Inc.
If you’re planning a substantial construction project, delaying insurance planning could cost you significantly in the long run. Instead, make a proactive decision—secure your coverage early, streamline risk management, and maximize your budget.
The first step is simple: Call Pacific Insurance, Inc. today at (801) 561-5550.
You’ll be connected to an experienced insurance advisor who will:
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Review your upcoming project scope.
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Determine if OCI (or a different program) is the best fit.
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Provide a clear cost-benefit analysis.
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Draft a customized Owner Controlled Insurance Program that secures everyone involved in your project.
Final Thoughts
Owner Controlled Insurance is more than just a financial tool—it’s a powerful strategy for minimizing risks, ensuring coverage consistency, and protecting long-term project success. For owners managing high-value, complex construction projects, OCIP offers unparalleled advantages over traditional contractor-based insurance.
But the effectiveness of your OCI program depends entirely on who you choose to design and manage it. With Pacific Insurance, Inc. you’re not just buying insurance—you’re gaining a trusted risk management partner with years of experience helping project owners succeed.
Don’t wait until construction begins to safeguard your investment. Call Pacific Insurance, Inc. today at (801) 561-5550 to discuss how an Owner Controlled Insurance Program can transform your next project from risky to resilient.
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