By now, I’m sure you’ve heard me say insurance is critical for society. I know, friends, I might sound like a broken record… but hear me out. Without insurance, cars can’t be on the road. Mortgages can’t be issued. Contracts can’t be agreed. Buildings can’t be built.
The most recent wave of insurance innovation has seen lots of adaptation and improvement in personal and small business insurance. However, out of all the many lines of business out there, the one that we’ve observed as remaining largely untouched – neglected, even! – is construction insurance.
For the very insurance product that enabled your house, office and local train station to be built, I’m hopeful that things are looking up. I’m thrilled to share news of our latest insurance-related investment: OnSiteIQ.
Providing eyes, on site
OnSiteIQ’s visual documentation and risk assessment software enables owners, developers, general contractors, insurers – in fact, anyone with an interest in the development of a construction site – to better understand what is going on with a site.
OnSiteIQ goes beyond insurance as we tend to know and think about it. This company is about the business of risk – and managing it. Risk related to people, regulatory requirements, fire, and even the financial and reputational risks of not completing a project on time – or getting it wrong!
Most construction sites today are exposed to all of these risks, and more. OnSiteIQ is using advanced computer vision technology to provide a seamless progress, quality, and safety assessment capability. Construction is so different from other industries. Risk control (underestimated for so long) can be the most valuable and effective tool for insurance companies to improve site safety, and even improve profitability.
There’s no better time to tackle this problem
The circumstances that led to the founding of this important business are truly shocking. As recently as 2016, an average of 3 workers died on construction sites in the United States, every day. Every day. This means that one in five worker deaths are now in construction, and many more suffer life-changing injuries. This should be zero – there is so much work to be done. Technology is finally arriving in construction.
In New York, between 1986 and 2017, the number of OSHA inspections decreased by 63%. Furthermore, over the past five years, the New York State fatal occupational injury rate in construction increased by 30%. The total cost of all disabling workplace injuries in the United States hit $60bn in 2017, according to Liberty Mutual’s Workplace Safety Index.
There are more than 252,000 construction sites in the United States, yet there appear to be fewer than 10,000 Environmental, Health, and Safety (EHS) specialists in the country working on construction. That means that less than 5% of construction projects have a full-time safety manager. Between October 2017 and September 2018, there were roughly 9,000 construction-related inspections and handed out over 22,000 citations. Penalties are now up to $130,000 per violation for wilful or repeated transgressions.
It has been a real pleasure to get to know the OnSiteIQ team throughout 2018. Co-founders Ardalan Khosrowpour and John Mollis have come together to tackle this very pertinent problem head-on at exactly the right time. Ardalan is a Charles Via PhD Fellowship recipient and a Myers-Lawson School of Construction PhD Fellowship holder. John is an expert in computer vision who formerly worked at SRI International. We’re excited about the impact they’ll have on the construction industry for a long time to come, and very happy to be working with them.