Preconstruction — Risk & Contracts

OCIP / CCIP (Wrap Policy)

One insurance program covering the owner, general contractor, and subs on a single project.

Quick Answer

A wrap-up policy is a controlled insurance program that covers all eligible parties on a project — owner, general contractor, and subcontractors — under one program instead of each carrying separate policies. When the owner buys it, it's an OCIP; when the contractor buys it, it's a CCIP. It typically bundles general liability, excess liability, and often workers' compensation.

The Full Picture

Wrap-up insurance exists to replace the tangle of separate policies every contractor and subcontractor would otherwise bring to a project. Under a traditional approach, each party insures itself and passes the cost through, coverage gaps and overlaps are common, and disputes over whose policy responds are frequent. A wrap-up consolidates coverage for the whole project under one program.

The two forms differ only in who controls the program. An owner-controlled insurance program (OCIP) is purchased by the owner; a contractor-controlled insurance program (CCIP) is purchased by the general contractor. Either way, the program bundles general liability and excess liability — and often workers' compensation — for the enrolled parties on that specific project.

Enrolled subcontractors don't provide their own equivalent coverage; instead they're issued a certificate showing enrollment, and the cost of the coverage they'd otherwise carry is deducted from their bids. That deduction, and how it's calculated, is a common point of friction, so credit methodologies have to be spelled out clearly.

In preconstruction, a wrap-up changes how subcontractor bids are structured and leveled, because subs must strip out the insurance they'd normally carry. It also concentrates coverage decisions, so gaps — completed-operations coverage duration, enrollment eligibility, and how the wrap coordinates with builder's risk — need close attention before the program is set.

Real Examples

→OCIP on a large project: An owner places an OCIP for a major campus build, covering itself, the GC, and all enrolled subs under one liability and workers' comp program instead of dozens of separate policies.
→Bid credit deduction: Enrolled subcontractors deduct the cost of the liability and workers' comp coverage they'd normally carry from their bids, since the wrap-up provides it, per a defined credit methodology.
→Enrollment certificate: A sub joining the project receives a certificate confirming enrollment in the CCIP rather than furnishing its own insurance certificates for the covered scope.

Common Misconceptions

People assume: OCIP and CCIP are fundamentally different kinds of insurance.

Actually: They're the same wrap-up structure; the only difference is who controls it. An OCIP is owner-controlled and a CCIP is contractor-controlled, but both consolidate liability — and often workers' comp — for the project's parties under one program.

People assume: A wrap-up covers every risk on the project.

Actually: A wrap-up typically bundles general liability, excess liability, and sometimes workers' comp — but not everything. Builder's risk, professional liability, and certain other exposures often sit outside it, so gaps between the wrap and other policies have to be managed deliberately.

Does MeltPlan Solve This?

Not directly

A wrap-up program is an insurance structure placed and administered by an owner or contractor with their broker and insurer, including subcontractor enrollment and bid-credit accounting. That's a risk-transfer and program-administration workflow, not document review or takeoff, so it's outside MeltPlan's scope. Your broker and program administrator run the wrap-up.

Frequently Asked Questions

What is the difference between an OCIP and a CCIP?

Only who controls the program. An owner-controlled insurance program (OCIP) is purchased by the owner; a contractor-controlled insurance program (CCIP) is purchased by the general contractor. Both are wrap-up programs that consolidate coverage for the project's enrolled parties under one program.

What does a wrap-up policy cover?

Typically general liability and excess liability for the enrolled parties, and often workers' compensation, on a single project. It usually does not cover everything — builder's risk and professional liability commonly sit outside the wrap, so coordination between programs matters.

Do subcontractors need their own insurance on a wrap-up project?

Not for the coverage the wrap-up provides. Enrolled subs receive a certificate of enrollment instead of furnishing their own equivalent policies, and they deduct the cost of that coverage from their bids under a defined credit methodology.

Why do owners or contractors use wrap-up insurance?

To consolidate coverage, close gaps and overlaps between separate policies, gain volume purchasing power, and control claims for the whole project. On large projects a single program can be more efficient and more consistent than dozens of individual policies.

Related Terms

Builder's Risk PolicyProperty insurance covering a project while it's under construction against physical loss.Indemnification ClauseA contract provision making one party cover certain legal liabilities of another.Risk Allocation (Construction)Deciding, in the contract, which party carries each of a project's risks.Preconstruction Risk ManagementFinding and assigning a project's risks before ground breaks, while they're still cheap to manage.Risk RegisterThe living log of every identified project risk, its owner, its score, and its response.Force MajeureA clause excusing a party from delay caused by events beyond its reasonable control.

More Preconstruction — Risk & Contracts Terms

Sources

  1. IRMI — Best Practices for Participating in a Wrap-Up (expert commentary)
  2. IRMI — Construction Industry risk and insurance resources
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