Engineering Inc. - July/August 2007 - (Page 21)

A massive mudslide destroyed this section of Bluetooth Highway at Yellowstone National Park, one of the highest—and most rugged—elevation roadways in the U.S. says Spitzley. “And on the surface, we had to stabilize 500,000 cubic yards of waste rock and keep the dust under control. We had full-time health and safety people monitoring conditions. Not only was the monitoring equipment important, but they did visual inspections as well,” he explains. Spitzley says selecting contractors to work on the project was a major issue because of safety concerns. “What we did was require each contractor to hire a safety professional. That person was responsible to implement all safety procedures and was to report directly to the contractor owners. This way, the safety pro was responsible for all onsite safety issues, not the onsite superintendent.” Spitzley reiterated his firm’s proactive Examine insurance Policies to Protect your People nce a firm enters into a contract, the ultimate goal is to see the project through to completion. But when building in unstable conditions, success is never guaranteed. While engineering firms must seek to act in the best interest of the client, the safety and well-being of their employees, each of whom assumes a significant amount of risk by volunteering for projects overseas, is priority no. 1. louis Berger’s Michel Jichlinski says his firm keeps “reasonable” coverage to protect its people, but “does not consider that upping the level of insurance is the answer to risk management. “What [engineering firms] really have to do is decrease the probability of the bad event happening,” he points out. stanley Consultant’s rick smith says he doesn’t believe working under extreme conditions has much impact on a firm’s professional liability insurance (PlI) needs: “We are still required to do the work to the standards of the profession, regardless of where it is,” he explains. tom Porterfield, vice president with CnA/Victor o. schinnerer & Co., a Maryland-based insurer, says PlI issues are not fundamentally different for extreme conditions. O CnA/schinnerer’s policies provide worldwide coverage, though the standard of care that prevails in the country where the work is done determines if a firm is negligent—and that standard may be different than in the u.s. some carriers also might require a special endorsement for work outside the u.s., its territories and Canada, Porterfield says. firms should consider supplementing their PlI policies with policies for general liability, kidnap and ransom, protection against currency fluctuations or business interruption, suggests Porterfield. CnA/schinnerer offers kidnap and ransom policies that cover the financial cost of paying ransom following an actual kidnapping, as well as hijackings and threats to kill, injure, abduct, damage property, contaminate products, divulge trade secrets or introduce computer viruses. the policy covers hiring negotiators, interpreters and consultants to deal with the threat, as well as costs for any medical or psychiatric treatment and rest and rehabilitation for the victim. separate policies also might be needed for foreign work. According to stanley’s Cecchi, offshore work and diving requires “a whole different world of insurance” that is “not easy to get” from reliable carriers at a reasonable price. As with any insurance needs, it is important to “work with a knowledgeable broker that knows foreign coverage and foreign exposures,” adds smith. Many of the same considerations that apply to domestic contracts are applicable overseas, says Porterfield. firms must select their clients carefully, understand client expectations and educate clients on the proper balance between risk and reward. Albert rabasca, director of industry relations for Xl Insurance, a Monterey, Calif.-based insurance carrier, says it is essential to know the culture, physical and geographic considerations, political climate and local design standards and codes relevant to the area in which work is being conducted. “And check out local licensing laws, too,” rabasca says; “Many [ordinances] require that foreign firms associate with local firms before conducting business. Certain geographic regions also have conflicting procedures and requirements for dealing with natural disasters, such as earthquakes and hurricanes—all of which are essential to know going in,” he explains. firms planning to use innovative technologies also must work to edu- cate their respective clients about the associated risks. local standards of care may not exist for innovative designs or even new nuances in tried-and-tested designs, notes rabasca, which is why foreign clients “need to buy into the risk—and they need to understand it.” engineering firms also should consult the u.s. treasury Department’s list of countries where American firms are forbidden to practice. the list, located at the office of foreign Assets page on the Department’s website at www. ustreas.gov, also contains the names of those people and governments prohibited from doing business with u.s. companies. though foreign code violations typically are covered under most PlI policies, Xl’s rabasca points out, violations of u.s. law are not. to be sure, foreign engineering projects carry their fair share of risks, but successful ventures also can result in significant rewards, says stanley’s smith. though his firm doesn’t intentionally look for projects in difficult locales, he says, it is company practice to “do work that improves the lives of others when we can.” He adds: “If we can do so, and assist our clients at a reasonable risk, we will.” July / AuGust 2007 ENGINEERING INC. 21

Table of Contents for the Digital Edition of Engineering Inc. - July/August 2007

Call for Entries
Contents
From ACEC to You
News & Notes
Market Watch
Legislative Action
The Big Dig
Risky Engineering
2007 Professional Liability Survey
Institute For Business Management Fall 2007 Course Catalog
Roadside Technology
2007 Convention Wrap-Up
2007-2008 Excom
2007 Fall Conference Primer
Business Insights
Technology
Members in the News
One on One

Engineering Inc. - July/August 2007