What are Wrap-Ups or Controlled Insurance Programs (CIPs)?

The use of Wrap-Ups or Controlled Insurance Programs (CIPs) can be traced back to the late 1940s and early 1950s with the boom of mega-construction projects.

Now Wrap-Ups are used as a risk management technique for handling loss exposures related to single and multiple site construction activities.

Wrap-Ups provide coverage for the job-site risks of the following key players:

  • Owner
  • Construction Manager
  • General Contractor
  • Contractors
  • Subcontractors
  • Design Firms (CGL only) unless on-site for WC


What are the benefits associated with Wrap-Ups?

Key benefits include:

  • Unified Loss Control program, Underwriting and Policy Services, Claims Management
  • One General Liability policy
  • Minimized litigation
  • Effective job-site safety training
  • Greater competition – i.e. more contractors are able to bid, as the high limits of insurance are no longer barriers
  • The insurer may be admitted with a quality rating vs. many subcontractors with non-admitted insurance and lower rated insurers. Non-admitted wrap-up insurers will be A-rated
  • Removal of the risk of not being notified that insurance is cancelled or non-renewed
  • Increases ease of financing project – i.e. banks or limited partnerships can be named as an additional insured


So why improve upon something that has worked since the 1950s?

There's always room for improvement, and the Professional Employer Organization (PEO) brings several key advantages to the table:

  1. One Workers’ Compensation  (WC) policy

  2. One payroll administrator

  3. One HR benefits coordinator

  4. A healthcare plan to comply with the Federal Affordable Care Act

  5. Direct deposit of actual payroll on a regular basis to all employees

  6. Prompt notice and investigation of any WC claim

  7. Pre-employment physicals on employees on a discounted basis

  8. Work with unions where applicable

  9. Focus on enhanced workplace safety

  10. Ability to fire any employee for failure to comply with safety requirements

  11. Drug and Alcohol testing on a pre-employment, random, and/or post accident basis

  12. Arrange for installing and monitoring of job site surveillance cameras as well as regular tool box discussions on safety and training issues