Q and A: Griffiths & Armour's Stephen Bamforth explains Integrated Project Insurance.

Griffiths & Armour group chief executive Stephen Bamforth explains the basics of Integrated Project Insurance.

What is Integrated Project Insurance?

IPI is an innovative form of insurance that insures project risks rather than liabilities.  It operates on a blame-free basis and insures outcomes rather than causes; all members of the project are covered – including the client – and all rights of subrogation are waived.

Why is it needed?

IPI supports collaborative working and the use of truly integrated teams, helping to drive out waste, deliver innovation and provide better, more cost effective solutions to the needs of clients.  It is the only insurance product capable of supporting BIM Level 3.

Is Government supporting it?

Yes, government has committed to trialling IPI as part of its Construction Procurement Strategy.

How and why?

Government is supporting demonstration projects to show that

(a) the hoped-for savings in capital costs and procurement times can be achieved in practice; and

(b) to encourage the insurance market to create a commercially viable product that can be made available to both the public and private sectors.


How would it work?

IPI insures the integrated project team’s performance against specification, time and cost.

How would liabilities work?

Liabilities to third parties arising during the construction process are covered.  There are no internal liabilities to consider; the project
team operates on a completely
blame-free basis.

Who would be in charge?

A project board, including the client. There would be a light touch audit of designs by an independent party.

Would the auditors be exposed?

No – that would go against the blame-free culture.  This will be dealt with contractually. 

Would PI premiums be adjusted?

Yes.  Fees earned on IPI projects would not need to be declared under consultants’ annual PI covers.  There will be no duplication of insurance costs.

Next steps?

Demonstration projects will shortly be under way following which we will provide feedback.

Why is G&A supporting IPI?

As PI specialists we have first hand knowledge and experience that turning risks into liabilities really does not work!
