Welcoming Mark Reagan to the Vita Construction Advisory Board!
e are excited to introduce Mark Reagan, our newest member of Vita's Construction Advisory Board. With an extensive 53 years of experience in and around construction risks and insurance, Mark has gained valuable insights into the preventable nature of the fatal four causes of casualties on the job site: falls, struck by, stuck between, and electrocution. He acknowledges how Vita's groundbreaking technology will not only enhance safety but also positively impact builders' profitability by saving time. In this Q&A you’ll learn more about his expertise and vision for Vita Industrial.
What inspired you to join Vita Industrial’s Construction Advisory Board? How do you see your expertise contributing to Vita's goal of helping teams work safer, lift faster, and reduce costs?
My experience in construction risks has been fed by my curiosity about how all the elements in building a project can be examined to find better solutions to persistent problems. Many means and methods are only incrementally better than fifty or one hundred years ago. That includes risks, attendant losses, and how risks are managed for retention or transfer. Vita represents true innovation, bringing several technologies to the historic challenges of lifting and placing loads. The motion sensing for all three axes grew out of both the military and space programs' needs to know where objects are moving in space relative to some often dynamic point. Vita has harnessed and refined those capabilities to refine and redefine lifting and placing loads with great precision and efficiency. That’s exciting.
In your view, how is the landscape of construction insurance evolving, and what role do you see Vita Industrial playing in this transformation? What opportunities do you foresee in the construction industry that make it an exciting time for insurance innovation?
Competitive pressures are unrelenting. The quality of competition in a bid-to-win environment stresses all the players to build faster and at lowered costs. Time is money, but shortcuts are inevitably the short road to failure. Best practices at every stage of construction yield the best results in quality and cost. A key best practice that is too often deemphasized is preplanning the project on a daily/weekly basis. This key discipline drives superior results for time and cost. It also drives the very best safety results. These in turn drive efficient risk analysis and decisions on retaining and transferring risks. The best contractors know that the cost of risk for construction is 3-7% of total costs. Best safety practices regularly reduce that spending by 30-50%—the very best moving to capture the opportunity.
Given your experience in risk management, how do you believe the construction industry can better align insurance incentives with safety and efficiency practices?
Insurance is seldom incentive-driven. Insurance and risk spending is driven by predictive modeling based on the recent historical record. It’s worth noting that the very best contractors present superior loss histories that are the product of their disciplined preplanning and equally disciplined execution. The most efficient and effective processes are those that don't take shortcuts. They deliver superior results. It also yields the safest projects. These metrics allow for aggressive analysis and modeling for insurance. All insurance is organized into similar pools of risks and historical loss experience. The best is accorded superior pricing. Total costs of risks can be engineered to reflect the cost of premiums and losses retained in the deductibles. There is money to be saved.
How do you anticipate the regulatory environment impacting the evolution of construction insurance, particularly in terms of safety standards and risk management practices?
Given the continuing fact that construction is the most dangerous industry, scrutiny will continue. It must continue. An average of three workers a day are killed on American job sites. Yet, and this is very important, the best contractors are the very safest. Workers’ compensation modifiers are predictive tools. Red lights are flashing on the less safe contractors, but they are allowed to bid, win, and operate projects. The increased costs they must pay drive the search for shortcuts that will lead to more accidents and casualties. A more thorough regulatory process works in several states. It saves lives. Politics aside, it makes the most sense.
Are there regulatory changes you believe would positively influence the industry's direction?
Further to my previous comments, insurance industry interests and state licensing bodies need to enforce discipline around bad safety experiences. Most discipline is inadequate, even after fatalities.
Looking ahead, what is your long-term vision for the role of insurance in the construction industry?
The best contractors have already developed programs that blend risk retention and risk transfer. Some have formed risk purchasing groups. Insurance lends itself to the engineering and modeling skills required of the best builders. The cost of risk engineering continues to evolve and develop. The very best contractors already treat risk management as a profit center charged with delivering profit margin opportunity and efficient use of capital.
What are the key milestones you hope to see achieved in the next few years in the intersection of construction and insurance?
A broader understanding of risk management as more than just buying insurance already exists. A more sophisticated understanding points to margin opportunities for those who understand that some element of the cost of risk is embedded in all costs.
Do you think there is potential in the future for clients to see insurance savings by using the Vita Load Navigator?
Absolutely. Risks for injury and property damage are severe for lifts. Pricing reflects the risks. Vita dramatically reduces the risks, the related losses, and the premiums come down.
Is there anything else you would like to add about your role with Vita Industrial?
Vita can move the appreciation of safer and faster impacting builder’s profitability. Time saved is one element. Safe performance offers the potential for Vita to be the preferred must-do for lifting and placing.
