by Dr Bill Peacock, Managing Director, GRM Development Solutions
Who would have thought that my PhD research in the late 1980s would come to our aide in 2020 and 2021 to help reduce our Professional Indemnity Insurance (PII) Premiums!
During that research I spoke to Insurance Personnel about their views on construction and the uncertainties in ground conditions. Now I find myself talking to Brokers and Underwriters explaining the risks to them of how our consultancy provides engineering and environmental services to deal with those uncertainties.
PII premiums for engineering consultants jumped massively a couple of years ago (most had to deal with a doubling cost or more!). So, whilst it was always a big addition to overheads it got to over 3% of turnover for some! In a business that is ecstatic with 5% profitability you can imagine the shock.
At GRM we use the same management and communication of risks to finesse more favourable economic outcomes from ground uncertainties posed to land deals and subsequent development designs. Our insurance broker (Gallagher’s: www.ajg.com/uk) welcomed this approach, and was also willing to engage with us to gain a detailed understand of the risks and what we have done to mitigate.
I like to think the drop in premiums is testimony to our core values, and that an insurance industry highly nervous of engineering as a whole, has recognised that GRM have good control on business and ground risks.