The SIC code for highway, street and bridge construction includes bridge contractors. This category is dominated by the liability and workers compensation lines of business. While there are a number of non-employer enterprises, most of the premium is developed by small commercial and middle market enterprises.

The total annual inland marine premium for this segment exceeds $58 million but this figure appears small compared to the almost $1.5 billion in liability premium and $1 billion in workers compensation premium.

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Bridges are at the heart of any transportation system. They smooth out the rolling contours of the national landscape. They span numerous waterways, as well as canyons, culverts and other dips in the road. They also extend over other highways. While a bridge collapse causes immediate damage to persons and property on and beneath the structure, it causes long-term economic consequences to those that depend on it for employees and customers. Local, state and federal agencies are placing increased emphasis on bridge inspection. This additional oversight is identifying problems that can be repaired only by adding dollars to street and road budgets. And additional dollars mean more projects. These projects impose additional strain on the public entities that oversee the construction and that normally design the bridge projects. Contract bidding includes both the construction and the design of the bridges and, while this adds money for the bridge contractor, it also increases the potential for lawsuits.

Here is an example of design/build loss potential.

The residents of Little County demanded that all county bridges be inspected. As a result, three were immediately closed. While alternative routes and workarounds exist, those who use these bridges regularly demand that they be repaired immediately. Little County normally repairs only one bridge a year and does not have the staff to do the required work on all three. It decides to bid two of the bridges as design/build projects. This decision reduces the pool of candidates but a bid is accepted and construction on all three bridges begins. When an accident occurs at the bridge the county designed and the county is included in the suit because of alleged poor design, it claims sovereign immunity. However, when an accident occurs at a bridge designed by the bridge contractor, the bridge contractor named in the ensuing suit must respond.

The demand for bridge contractors is increasing as the political will has resolved to fix our crumbling infrastructure. Harvey Goldenberg, senior vice president, Burns & Wilcox, says “I think the Minneapolis bridge collapse opened people’s eyes about infrastructure problems in this country and the fact that the dollars don’t seem to be readily available to make repairs and improvements.” Tom Murphy, Quaker Special Risk, reports, “We see states and regions and individual cities taking a much closer look at their infrastructure and determining what condition this bridge or road is in, when it was last inspected, and so forth. Some work is being done immediately that wasn’t on the schedule to be done now.”

While this can mean quite an increase in the number of projects for bridge contractors, according to Rob Brewer, vice president and construction group manager for Travelers, it also increases the strain on public agencies. He states, “Bridges have traditionally been designed by the state department of transportation engineers. Those resources are now kind of maxxed out and they’re asking contractors to partner with engineering firms to design bridges. The growth of design/build and the recent emergence of integrated project delivery mechanisms has created an entirely new exposure for contractors.”

Dan Noe, underwriting manager for the Bituminous Transportation Contractors Program, is still concerned that, “there's a lot of talk, but I don’t necessarily see a sudden influx of money and jobs for bridge contractors. I think it’s going to be there and it’s just a matter of getting the money.” When asked if he was concerned that inexperienced contractors might be utilized, he stated, ”I’d be very surprised if that happened. Most contractors we talk to these days have plenty of capacity and are looking for work. There are always exceptions but they are in the minority.” Mr. Brewer expanded on that, saying, “Bridges are very complicated construction projects and contracts are not awarded based only on cost. The Minneapolis I-35 project was awarded based not only on cost but also on design elements and speed of construction. I would say that an inexperienced contractor probably won't qualify. While these are public jobs, public jobs don’t always mean low bids. The term usually used is ‘lowest qualified bidder’.”

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