Abstract
A variety of insurance options are used when managing risk in the construction industry. Numerous insurers operating on the Polish market provide suitable types of insurance, thus allowing participants of a construction process to obtain a comprehensive cover against almost all potential risks. Therefore, ‘all-risks’ types of insurance is of particular importance in case of construction and assembly activities. In addition to this instrument, the paper also deals with other forms of insurance used in the construction sector in Poland, which apply to various aspects of activities conducted by actors involved a construction project. This is the main topic of the paper, which also outlines the theory on the subject as well as providing the results of empirical research carried out in this area and emphasizing the practical applicability of the discussions. Consequently, the key aim of the paper is to present the issues related to insurance in the construction industry as a method of financing risk in operations of construction companies. The paper adopts a synthetic approach to these issues. The paper also reviews the related scholarly literature.
Highlights
Almost any type of industry has its specific risks which need to be coped with in order to continue in business [1]
In practical terms it is not always needed to obtain such insurance for every single construction project on hand. This is more, as emphasized before, about a formal requirement in the construction business in the public sector, such as in undertakings conducted within the framework of public private partnerships (PPP) [3]
This is an integral element of FIDIC (Federation Internationale des Ingenieurs-Conseils) contracts that are concluded, in particular, in case of larger construction projects, where risk is allocated in different ways, depending on the type of agreement signed between an ordering party and a contractor
Summary
Almost any type of industry has its specific risks which need to be coped with in order to continue in business [1]. Since the construction market in Poland is currently the investor’s market, contractors who want to win a tender are often forced to quote such a contractual price which will make them competitive on the market This problem concerns the public sector of the construction business and the private sector in all its forms and formulas. Insurers worldwide offer a wide portfolio of insurance products designed for the construction business These issues are addressed in the paper, which supplements the theoretical deliberations with the results of the empirical research conducted in this field, highlighting – at the same time – the practical applicability of the presented knowledge. The methods of deduction and induction are used in the publication
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