One Strike and You May Be Out

Controlling and mitigating the risks of underground utility strikes.
One Strike and You May Be Out
An increase in the amount of underground strikes comes from unmarked private property, mismarking and inadequate marking, and improper bidding on jobs that leave out necessary costs.

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Increased density of development has created an unforeseen result — a growing number of accidental underground utility strikes. The Common Ground Alliance’s 2015 Damage Information Reporting Tool report identified 278,861 utility damage events in the U.S. and Canada, resulting in $1.7 billion in property damage as well as 1,906 injuries and 421 deaths.

Based on these numbers, it’s clear that this is an issue that should be at the forefront of the minds of contractors who are responsible for underground excavation. We’ve developed a quick Q&A to guide you through the process.

Q: What’s causing these strikes?

According to the Common Ground Alliance, there appears to be consensus that there are three basic causes: inadequate excavation practices, notification not made and insufficient locating practices. We would add that an increase in the amount of underground strikes also comes from unmarked private property, mismarking and inadequate marking, and improper bidding on jobs that leaves out necessary costs. These necessary costs allow for the extra time needed to locate unmarked lines and pipes underground as well as costs associated with excavating these unforeseen utilities properly.

Based on our research, another common cause of underground strikes is using improper equipment during the dig, which usually stems from running behind schedule. Once behind schedule, a contractor must find a way to make up that time. Unfortunately, this can sometimes lead to cutting corners, rushing the job and leaving proper safety measures by the wayside. 

Q: What are the implications for underground contractors?

The impact for underground contractors breaks down into safety, profitability, insurability and future business prospects. Foremost, the underground contractor must be concerned about safety on the job. From an operational and profitability standpoint, issues include staff downtime and increased costs caused by claims and delays on the site. Insurance costs might also increase or, worse yet, insurers may decline to renew policies. The most important impact for the contractor may be a loss of current or future contracts due to a bad reputation.

Q: What should underground contractors do immediately in the event of a strike?

The most obvious steps are to halt excavation and turn off equipment to prevent sparks and fire. Leave equipment in place to avoid additional damage. An underground contractor should always contact the utility owner, even if there is no visible damage. If the contractor suspects the presence of dangerous gas or liquid, they should call 911 immediately. In all cases, it’s important to safeguard the lives of employees and bystanders, reroute traffic, and inform nearby residents and/or businesses. The final call should be to the risk adviser they are working with or insurance carrier directly to make them aware of a possible claim situation. 

Q: What are best practices contractors should adopt to mitigate damage and avoid strikes?

  • Start at the very beginning: Employees should be trained properly on locating underground utilities and the correct use of equipment and digging techniques, including when to use radar to detect the presence of underground lines and hand-digging and soft-digging techniques. They should also emphasize the correct type of equipment to use for every situation during the excavation. Contractors should follow job site checklists, and provide adequate on-site supervision as well as ongoing safety awareness and training.
  • Estimate jobs properly: Job estimates should include costs for allowing the time to locate underground utilities and verify marking, document 811 marking, dig around lines, use radar and have downtime in the event of a strike.
  • Review the site plans and call 811 at least 48 hours before digging. Review their flags and markings prior to starting the job to determine the proper equipment for the job. 
  • Identify, if at all possible, whether there may be additional lines that are not on site plans and/or are not marked.
  • Document the job site with photographs prior to commencement of digging, taking photos of flags and markings and showing the scale of where you’re digging.
  • Don’t assume the depth of utilities. Digging at a deeper depth than marked utilities does not always solve the problem. If you aren’t sure, dig slower and use smaller tools if necessary. 
  • Most important, use your industry knowledge, common sense and always keep a focus on safety!

Q: What about claims management in the event of a strike?

Prevention is always the best risk management strategy. Work with a risk adviser who has experience managing insurance for underground contractors and who understands the industry and has access to insurance carriers that are competitive for underground contractors. The adviser should also understand the safety and operational processes needed to avoid claims with underground strikes. Be sure that your risk adviser and carrier have an efficient claims management process, will work with you to develop safety training programs, can provide ongoing training including loss control, are responsive, and communicate well — and not just when it’s time for a policy renewal.

ABOUT THE AUTHOR

Sean Mainwaring is a risk adviser in the Tampa office of Lykes Insurance, a Florida-based commercial insurance firm. He can be reached at smainwaring @lykesinsurance.com. 



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