Wrap-up insurance is a consolidated insurance program that covers all contractors and subcontractors working on a single construction project under one master policy. There are two types: an owner-controlled insurance program (OCIP) purchased by the project owner, and a contractor-controlled insurance program (CCIP) purchased by the general contractor. Wrap-ups are common on large commercial construction projects, public works, and institutional projects where centralizing insurance reduces costs and eliminates coverage gaps between multiple contractors.
When you work on a project with a wrap-up program, you are enrolled in the master policy for CGL, workers compensation, and sometimes excess liability coverage during your time on the project. Your own insurance policies do not provide coverage for work performed on the wrap-up project. Instead, you are expected to exclude the wrap-up project payroll and revenue from your own policies, which should reduce your own premium proportionally.
For roofing subcontractors, wrap-ups require careful coordination with your insurance agent. You must provide your carrier with a wrap-up exclusion so that the project's payroll and exposure are removed from your own policies. At audit, your own carrier should exclude the wrap-up project's numbers from your premium calculation. Keep detailed records of which projects are under wrap-up programs and provide that documentation during your premium audit. Failure to properly exclude wrap-up project exposure means you pay premium on your own policy for work already covered by the wrap-up, resulting in double payment. Also verify that the wrap-up covers completed operations for an adequate tail period, because your own policy will not cover claims from wrap-up project work.