<abstract xmlns="http://www.w3.org/1999/xhtml">

<p>The risks associated with construction can be transferred to insurance. However, in the Zambian construction industry (ZCI), knowledge and use of insurance covers (performance security, advance payment, and contractor’s all risk insurance) have not been previously fully elucidated. The study was designed to cover this knowledge gap among professionals in government and private sector construction institutions, as well as insurance and financial institutions. Analysed data were approached quantitatively. Based on responses collected from 68 participants purposively sampled using a structured questionnaire as instrument, results were discussed and conclusion drawn. Private sector personnel headed the number of respondents and were more likely to have had five or more years of work experience than those of the Government of the Republic of Zambia (GRZ) institutions (86 % vs 36 %, <italic>p</italic> = 0.001). Approximately 88 % of the participants both in the public 33 % and private 67 % sector had knowledge about securities and contractors’ all risk insurance. There was variation in the use of different securities and contractors’ all risk insurance, with the lowest uptake being for retention bonds. Personnel from public institutions were more likely to have used CAR-insurance security in one or more projects than those from the private sector (100 % vs 47 %, <italic>p</italic> = 0.009). Participants also reported that they had valid securities and had successful implementation of securities with a variable level of compliance among different stakeholders. Finally, approximately half of the participants had effective systems for monitoring performance of securities, and a majority of the systems were said to be effective. Education of key players in risk management, formulation and enforcement of laws are necessary to ensure effective risk management practices.</p>
</abstract>

The risks associated with construction can be transferred to insurance. However, in the Zambian construction industry (ZCI), knowledge and use of insurance covers (performance security, advance payment, and contractor’s all risk insurance) have not been previously fully elucidated. The study was designed to cover this knowledge gap among professionals in government and private sector construction institutions, as well as insurance and financial institutions. Analysed data were approached quantitatively. Based on responses collected from 68 participants purposively sampled using a structured questionnaire as instrument, results were discussed and conclusion drawn. Private sector personnel headed the number of respondents and were more likely to have had five or more years of work experience than those of the Government of the Republic of Zambia (GRZ) institutions (86 % vs 36 %, p = 0.001). Approximately 88 % of the participants both in the public 33 % and private 67 % sector had knowledge about securities and contractors’ all risk insurance. There was variation in the use of different securities and contractors’ all risk insurance, with the lowest uptake being for retention bonds. Personnel from public institutions were more likely to have used CAR-insurance security in one or more projects than those from the private sector (100 % vs 47 %, p = 0.009). Participants also reported that they had valid securities and had successful implementation of securities with a variable level of compliance among different stakeholders. Finally, approximately half of the participants had effective systems for monitoring performance of securities, and a majority of the systems were said to be effective. Education of key players in risk management, formulation and enforcement of laws are necessary to ensure effective risk management practices.

Exploratory Analysis of Securities and Contractors’ All Risk Insurance Implementation in the Construction Industry of Zambia

Baltic Journal of Real Estate Economics and Construction Management

This work is licensed under the Creative Commons Attribution 4.0 International License.

The risks associated with construction can be transferred to insurance. However, in the Zambian construction industry (ZCI), knowledge and use of insurance...

Exploratory Analysis of Securities and Contractors’ All Risk Insurance Implementation in the Construction Industry of Zambia

Pubblicato online: 07 dic 2023

Pagine: 289 - 304

Ricevuto: 25 ott 2023

Accettato: 06 nov 2023

DOI: https://doi.org/10.2478/bjreecm-2023-0018

Parole chiave
Construction guarantees, contractor’s all risk insurance, risk management, securities

© 2023 Kabemba S. Ngoy et al., published by Sciendo

This work is licensed under the Creative Commons Attribution 4.0 International License.

Exploratory Analysis of Securities and Contractors’ All Risk Insurance Implementation in the Construction Industry of Zambia

Pubblicato online: 07 dic 2023

Pagine: 289 - 304

Ricevuto: 25 ott 2023

Accettato: 06 nov 2023

DOI: https://doi.org/10.2478/bjreecm-2023-0018

Parole chiaveConstruction guarantees, contractor’s all risk insurance, risk management, securities

© 2023 Kabemba S. Ngoy et al., published by Sciendo

This work is licensed under the Creative Commons Attribution 4.0 International License.

Parole chiave
Construction guarantees, contractor’s all risk insurance, risk management, securities