What are the top risks in commercial construction?
Paul Lucas 00:00:15
Hey, Rach. Yeah. So Ryan, I’m assuming you’ve had all the questions in advance of you.
Ryan 00:00:20
Yes.
Paul Lucas 00:00:21
Good stuff. Any any issues with them? Are you happy, comfortable?
Ryan 00:00:24
Yeah, we’re ready to go when you whenever you are, we’re good with the content and excited to share the story.
Paul Lucas 00:00:30
Okay, well, there’s no, there’s no tricks. And I guess probably the most important thing to know is that is, we very much stick to the script, not saying that this would apply to you necessarily, but some people would not be very comfortable if we started asking them follow up questions or things that they’ve not planned for, and so on. So we very much, you know, go through the order exactly as planned. So just answer each question as thoroughly as you can, because then I’ll be moving on to the next one. So with all that said, I just want to check that I’ve got your details correct. So you are Ryan Powers, SVP, Head of Instruction at QBE North America. Is that correct?
Ryan 00:01:06
That’s correct. Thank you.
Paul Lucas 00:01:08
All right. Excellent. Can you hear my wife coughing in the background? By the way?
Ryan 00:01:12
You’re safe.
Paul Lucas 00:01:13
All right, that’s good. I’m just checking go or wasn’t gonna have to hate just move to another room to another room with your coffee, please. But as long as we’re good. That’s, that’s excellent. And so yeah, so with all that said, I mean, unless there’s any questions that you’re and I think we’re ready to roll with you. All right. Great. One of the things to note, by the way, I will just say at the end of my introduction, I’m going to say Ryan, welcome to Insurance Business TV. So if you can just say, hey, great to be here, or something like that before we start the questions. And similarly, once you finish giving all of your answers, I’m going to say something along the lines of You know, huge thanks for your time today. And then again, if you can just respond and say you know, thanks for having me, or or anything else, you can even some people choose to take that opportunity to say if anybody wants to reach out they can contact me on. So if you want to add something like that, you’re you’re more than welcome. But that’s that’s entirely up to you. Anyway, we’ll get rolling.
Paul Lucas 00:02:13
Hello, everyone, welcome to Insurance Business TV, and welcome to a very special construction insurance focused edition brought to you by QBE North America. The construction industry, of course plays a massive role in the US economy. But this has been challenged in recent years by a host of risks. QBE North America decided to serve a 500 US commercial general contractors and construction managers to uncover the risks that are that are impacting their timelines, budgets and safety. In this edition, we’re welcoming Ryan Powers SVP, Head of Construction at QBE North America, who’s going to share some of the results with us, Ryan, welcome to Insurance Business TV.
Ryan 00:02:54
Paul, it’s a it’s a pleasure to be here. And thank you very much for having me.
Paul Lucas 00:02:58
So Ryan, shed some light for us. What risks are causing commercial general contractors and construction managers that the most concern right now?
Ryan 00:03:06
Yeah, I would say that this is a topic that has constantly evolved over time. And while there’s no shortage of risks that risk managers and commercial contractors are faced with, there were five that rose to the top of that list. And I think the key to that is to be constantly addressing and having a dialogue on it. So the top the big top five in order, we’re we’re cyber cost overruns, high interest rates, labor shortage and any potential economic downturn.
Paul Lucas 00:03:39
Well, let’s zoom in on those issues. If you don’t mind, tell me why you think those have been such a cause for concern.
Ryan 00:03:46
Each one probably has its own unique story. I think when we talk about it as a community, with the industry, there’s a lot of folks that will not be surprised by this list. But I do think if we had conducted this survey, maybe 10 years ago, the storyline here is the the meteoric rise of cyber in particular, when construction managers think of cyber from a distance, I think, in the infancy of this industry, the cyber industry. That is I think a lot of folks would have said, well, you know, contractors aren’t necessarily protecting consumer financial or health data, so maybe not a particular target of cyber criminals. However, I think the very nature of construction and the beehive of activity that not just job sites, but in particular contractual arrangements, it creates this network of vulnerability within the industry that I think now contractors are being more IP to recognize that that gap so to me, the big storyline here is the emergence of cyber in conjunction with the traditional storylines that we’ve seen, evolving. Over the past decades, which are still largely focused around employee safety, and also financial concerns to make make your business successful.
Paul Lucas 00:05:11
Yeah, cyber, of course, such a big issue for the entire insurance industry, not just related to construction, of course, but tell me a little bit about some of the steps that can be taken to mitigate some of these risks and how brokers in particular can be helping their clients.
Ryan 00:05:27
It’s the best question. So I would say, the best defense against cyber is the is our traditional methods, which is the human firewall, we need folks that are ready to know what, when something doesn’t smell right, to take the extra step to authenticate, whether that’s an email, a link or contractual vendor relationship. I think having the awareness of your frontline employees of this vulnerability is the key. And this might be an area where contractors team are not necessarily focused on this when they were learning their skills coming up in the industry, it probably wasn’t an area of concern. But here we are today, and the industry is under attack from the cyber criminals. And ultimately, these moments are exactly that their moments and the attack is won or lost by your the awareness of your frontline employee. So concentrating and awareness on this, it’s something that every industry needs to consider and to prioritize. But I do think in construction, it’s just an emerging trend that needs to be focused on from everybody go forward.
Paul Lucas 00:06:39
And I’m imagining that cyber coming out top of the list perhaps wasn’t such a big surprise for you. But were there any was there anything indeed, that did surprise you from from the survey results?
Ryan 00:06:50
Well, I don’t know if it’s a surprise, a couple of things here, I would say. So I’m always interested in seeing the nuances within sectors of the construction industry whenever we do some of these, some of these research efforts. So for me when I saw the trades of electrical, HVAC and heavy construction being particularly impacted by the labor shortage, labor shortage is something that every sector within the the industry is battling and have been battling for a well over a decade plus now. But I do get a little bit more interested in understanding how those sectors have a little bit of nuance. I think the electricians and HVAC folks will look at their carpenter friends, and say that there’s probably a little bit less of a shortage in that space, but it’s still there. So, you know, highlighting the the sectors that are particularly impacted by a labor shortage I find to be to be interesting. And then the other, you know, major, you know, I wouldn’t say a major surprise, but it is important to discuss. And I think, you know, as a somebody that serves the community, the construction industry, this is important to have the dialogue, it’s that risk managers know that there is a gap between their top concerns and their top areas of of least preparedness. So the same five that I mentioned earlier, are the same five that they feel least prepared for. So you at least now have a risk management, construction community that knows where their gaps are, and they’re looking for partners and resources to collaborate on. So, you know, as a brokerage community, as a carrier community, we have an obligation to educate ourselves so that we can make it easily digestible for our clients to navigate and prioritize that space. They get so much on their plate to navigate that they need to trust the experts in the industry, whether that’s their brokers, their underwriters, their risk control partners, financial advisors, legal advisors, everybody kind of has a role to play in this. And if we’re experts in our field, and can bring those those efforts to mitigate the gaps faster to our insurance in an efficient manner so they can focus on their business. I think that’s how we can best serve them.
Paul Lucas 00:09:13
Well, you mentioned that the brokerage community there and given the survey outcomes do you have any further tips for retail brokers that are operating in the construction space this year?
Ryan 00:09:24
I would say keep keep the dialogue going. There’s a there’s a fierce effort to get close to the to the client and I don’t think that should ever stop. Whether you’re a carrier or a broker, we got to keep this dialogue going share with them but we’re seeing we have the luxury of living in a risk management world where our whereas our contractors are they’re focused on their business. So what can we bring to them to highlight what their risks are, have a dialogue over what their mitigation tactics are and then build a plan together to address and mitigate those those gaps.
Paul Lucas 00:10:00
Yeah great so Brian in huge thanks to you and to QBE North America for your time today.
Ryan 00:10:05
We thank you very much we’re very excited to share our findings and hopefully this helps contribute to a safer and higher quality worktops
Paul Lucas 00:10:14
I’m sure it’s given a lot of people food for thought and thanks to everybody of course for watching. We’ll see you next time right here. Insurance Business TV.
Ryan 00:10:22
Thank you for
Paul Lucas 00:10:25
Excellent stuff, Ryan. I mean, I think you’ve you’ve been a one take wonder came across very well. Hello, everyone. Welcome to Insurance Business TV and welcome to a very special construction insurance focused edition brought to you by QBE North America. And the construction industry of course plays a massive role in the year of one second Rick Sorry, I’ve just lost my space on the page. So I’ll start that over one more time. Worry. All right, here we go. Hello, everyone. Welcome to Insurance Business TV and welcome to a very special construction insurance focused edition brought to you with QBE North America. The construction industry of course plays a massive role in the US economy. But this has been challenged in recent years by a host of risks. QBE in North America decided to serve a 500 US commercial general contractors and construction managers to uncover the risks that are impacting the timelines, budgets and safety. In this edition we’re welcoming Ryan Powers SVP, Head of Construction at QBE North America who is going to share some of the results with us, Ryan Welcome to Insurance Business TV.
