5 Loss Control Tips to Reduce Risk

With new home sales finishing 2024 2.5% higher than the previous year—and modest growth projected for 2025 thanks to steady macroeconomic conditions and a strong labor market—opportunities for home builders and general contractors continue to expand. However, with more projects comes greater exposure to risk. From water damage and jobsite accidents to claims tied to subcontractor work, home construction contractors have a lot of areas of exposure.

That’s why proactive loss control is essential for home builders and contractors like you, who want to protect their business and workers and reduce costly claims before you hammer the first nail.

Read on to uncover expert insights on minimizing risk, safeguarding your assets, and maintaining seamless business operations from Central’s loss control construction specialist, Shawn Gentry.

What is Loss Control?

Loss control is a great way to stay ahead of risks and prevent potential claims. It includes assessing potential exposures at insured locations and providing recommendations to help minimize risk.

At Central, loss control experts also support the underwriting team by offering a clearer, more complete understanding of what we’re insuring so each account is properly underwritten.

Our loss construction specialists, like Gentry, partner directly with Central’s agents and policyholders to deliver specialized support and craft tailored safety strategies for construction sites. He focuses on helping you foster safer work environments, protect your teams, and keep your projects moving forward. 

Through this collaboration, Gentry enhances Central’s dedication to providing proactive risk management solutions and building strong, lasting partnerships with policyholders.

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5 Loss Control Solutions for Home Construction Specialists

Solution #1: A Strong Subcontractor Agreement

In today’s fast-paced construction climate, many home construction teams rely on subcontractors for various aspects of the work. While these professionals certainly can help with speed and expertise on the job, they also bring new risks to the jobsite.

The best way to mitigate this risk is to establish a strong subcontractor agreement at the beginning of each project.

“The number one thing you should be doing is making sure you’re working with qualified subcontractors and have a solid subcontractor agreement in place,” Gentry explains. “That means verifying their insurance coverage, reviewing contract language for liability protections, and having legal counsel periodically review the agreement.”

Keep in Mind: If you need help creating or updating your subcontractor agreement, your loss control construction specialist is a great resource for assistance and advice.

Gentry explains that subcontractor agreements can help shield you from costly outcomes like construction defect claims or injury-related lawsuits. “If the drywall installer cuts a corner and someone gets hurt, for instance, you want to make sure you’re not on the hook for their mistakes,” he says.

Solution #2: Prioritization of Job Safety

Jobsite hazards are a leading cause of claims. Slip-and-falls, unsecured materials, and unsafe access points can all lead to costly general liability incidents. Builders should implement clear safety protocols for every subcontractor on-site and reinforce them with regular walk-throughs.

Regular jobsite inspections create a culture of accountability and help ensure all teams consistently follow safety procedures. Conducting thorough inspections allows you to catch hazards early, minimizing disruptions and reducing the risk of costly claims. By documenting inspections and corrective actions, contractors can protect themselves against liability and demonstrate proactive risk management.

According to Gentry, it’s not just about liability, but also quality control. It reflects in the final build when you prioritize safety and organization on the jobsite.

Learn more: Loss Control Applications of Artificial Intelligence on Construction Sites

Solution #3: Prevent Water Damage Before It Starts

Water damage remains one of the most frequent and expensive claims for home builders. “This is the big one,” Gentry stresses. “Whether it’s from an improperly installed plumbing fixture, construction defect, or weather-related issues, water intrusion can cause major losses.”

To reduce this risk, he recommends builders follow these steps:

•  Conduct on-site orientations that include identifying shutoff valves.
• Require subcontractors to verify all water is turned off before leaving the site.
• Secure doors, windows, and other access points against the weather.
• Consider implementing a “wet work permit,” a signed document indicating responsibility for any opened water sources, and confirmation they’re closed at day’s end.

“Five years ago, we used to see $20,000 water damage claims,” Gentry notes. “Now those same losses are running over $100,000 due to rising material and labor costs.”

Did you know? Water damage incidents make up over 30% of construction-related insurance claims annually and add up to approximately $16 billion in payouts annually.

Solution #4: Require Customer Sign-Offs for Quality Control

Another simple yet effective way to limit post-construction disputes is to build formal walk-throughs with the homeowner into your project approval practices. A documented sign-off ensures the buyer agrees the work meets expectations and adheres to specifications. 

This process helps prevent post-construction issues by combining detailed inspections, thorough documentation, and clear communication to address any outstanding items before project completion, reducing the risk of delays, costly rework, or warranty claims after turnover.

“They can always come back with concerns,” Gentry says, “but having that documentation in place gives you something to fall back on.”

Solution #5: Customize Your Loss Control Strategy—and Your Home Construction Insurance Coverage

No two construction companies operate the same way. That’s why a cookie-cutter approach to insurance and loss control often falls short. Gentry emphasizes the importance of partnering with an insurance provider who understands the construction space and can deliver tailored solutions.

At Central, certain designated construction clients get access to a dedicated construction specialist to help them set and maintain the best loss control practices for their specific business. That means working with someone who speaks your language, understands your risks, and brings solutions you can use.

Below, we’ve outlined examples of loss control projects that a specialized loss control expert like Gentry might help with:

1. Employee Safety Protocols

Establishing safety protocols to protect employees from common construction hazards is essential. These protocols include providing personal protective equipment (PPE), conducting regular safety training, and implementing procedures to prevent falls, electrocutions, and other accidents. ​

A loss control construction specialist like Gentry can help connect you with courses for your teams, work with you to develop site-specific loss control safety protocols, and even conduct in-person training with your team to help ensure they follow set practices.   

2. Fleet Safety Management

Implementing fleet safety procedures is vital for construction companies with large vehicle fleets. This practice includes conducting maintenance check-ups, daily vehicle inspections, and ensuring driver training programs are in place. Utilizing fleet management solutions like telematics and dash cams can also enhance driver behavior monitoring and training. ​

As useful as these products are, some construction managers struggle to get buy-in from their teams or train them on properly using the technology. Bringing in a loss control specialist like Gentry to help initiate these changes and explain not only how to use them properly but the overall impact they can make on safety is a great way to introduce these new systems.

3. Hazard Assessments

Conducting thorough hazard assessments helps identify potential risks within the construction environment. Loss control specialists like Gentry can perform on-site evaluations, analyze risks specific to the construction industry, and provide tailored recommendations to mitigate identified hazards.

While a construction manager might be able to conduct a hazard assessment on their own, Gentry explains that contractors see more success when an external party brings a new perspective and provides real-time suggestions for managing any risks they see.

4. AI-Driven Safety Enhancements

Leveraging artificial intelligence (AI) technologies can significantly enhance safety on construction sites, including:​

• Wearable Technology: Devices that monitor workers’ real-time heat levels, exertion, and proximity to hazards, alerting them to unsafe conditions.
• Video Analytics: AI-powered cameras that identify hazards like cluttered walkways or workers without proper PPE, and ensure only authorized personnel access restricted areas.
• Real-Time GPS Tracking: AI-enabled GPS devices that can locate workers during emergencies, facilitating prompt responses. ​

Insurance coverage and loss control go hand-in-hand when protecting your construction business. While insurance provides financial protection when incidents occur, effective loss control strategies can help prevent those incidents from happening in the first place. Loss control doesn’t just safeguard your operations—it can lead to more favorable premiums, broader coverage options, and a stronger long-term relationship with the carrier.

Build a Safer, More Profitable Home Construction Business With Central

Loss control isn’t about ticking boxes or policing jobsites—it’s about protecting what you’ve built. From water damage prevention to smarter subcontractor vetting, the right risk management strategy can reduce claims and strengthen your bottom line.

“When builders take the time to implement even a few of these best practices, they’re not just reducing their insurance risk,” Gentry says. “They’re setting themselves up for long-term success.”

Ready to evaluate your current risk management plan? Talk to your independent Central agent today about ways to protect your home construction business with custom loss control solutions and comprehensive coverage.