Unavoidable risks are inherent in every phase of every construction project. Whether it is an error or omission unintentionally committed during the design phase, or poor execution of project administration duties, risks threaten the design professional at every project turn. It is the successful design professional who recognizes that these risks cannot be eliminated, but can be effectively controlled through proactive risk identification and management.

There are three types of risk: known, anticipated, and unpredictable. Known risks are those that are readily identifiable after a project is assessed from a business and/or technical perspective. Risks in this category may involve unrealistic client expectations, hazardous working conditions, or lack of expertise. Anticipated risks are those that design professional will expect as a consequence of previous experience. These risks can be factored into a project budget, contingency fund and contract language. Anticipated risks may include economic changes, supplier delays, or staff turnover. Unpredictable risks are the most volatile because they occur unexpectedly and are beyond your control. The client files for bankruptcy or the subcontractor you hired suddenly walks off the job are examples of unpredictable risks. Unpredictable risks can be controlled through contract language and proper documentation during each phase of the project.

It is the intent of this site to identify the traditional risks that face the design professional at every project phase. Proactive means of controlling those risks are suggested in every section of the Project Life Cycle. However, the site does not represent the full range of risks that the design professional encounters during a project’s life cycle. Therefore, you are encouraged to contact XL Insurance Risk Control to discuss any risks that are not represented on this site for which you desire advice. XL’s Risk Control staff has hands on experience and industry knowledge to answer your risk management questions and provide you with sound advice.

Risks cannot be eliminated. Risks, however, can be managed by the savvy and proactive design professional.