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Risk Allocation Practices at the Bid Phase of the Construction Project: A Look at Factors that Impact Risk Premiums at the Bid Phase of the Construction Project

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Conference

2019 ASEE Annual Conference & Exposition

Location

Tampa, Florida

Publication Date

June 15, 2019

Start Date

June 15, 2019

End Date

June 19, 2019

Conference Session

ConstDiv Technical Session 4 - Pedagogy & Accreditation I

Tagged Division

Construction Engineering

Page Count

14

DOI

10.18260/1-2--33249

Permanent URL

https://strategy.asee.org/33249

Download Count

560

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Paper Authors

biography

Bashar Haddad Western Kentucky University

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I have a PhD in Construction management and MBA from Indiana State University. I also have a BSc in Civil Eng. from University of Jordan. I have 22 years of work experience with international companies. I have worked in major international projects in the Middle East in the capacity of Regional Manager and Contract /Commercial manager.

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Abstract

Exculpatory clauses are often used by owners in construction contracts to shift potential risks of construction to the contractor. Conversely, to mitigate those risks, Contractors use a risk premium as part of their contingency plan to alleviate the risks associated with accepting exculpatory clauses. The study identified five risks commonly used in construction contracts; namely, design errors, differing site conditions, construction errors, risks of payments, and damage for delays. The study examined the correlation among the contractor’s years of experience, company size and percent of self-completed work and the contractor’s risk premium for each identified risk. Results shown in the paper are based on real bids obtained from U.S. contractors.

Haddad, B. (2019, June), Risk Allocation Practices at the Bid Phase of the Construction Project: A Look at Factors that Impact Risk Premiums at the Bid Phase of the Construction Project Paper presented at 2019 ASEE Annual Conference & Exposition , Tampa, Florida. 10.18260/1-2--33249

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