Excluding the $1,000 “banger” that your neighbour’s kid owns, how many people do you know that own a car, but don’t bother to insure it? In Australia (in 2017) it was less than 15%. For those gamblers and the rest of us, the likelihood of a vehicle accident (ignoring theft, etc) was under 2%. In other words, more than 85% of Australians with a car they valued insured it against the 2% (or less) likelihood of a vehicle accident each year.
39% of construction and building companies suffer from theft or vandalism each year1, 3. Theft and illegal dumping at home sites in one suburb alone in Western Australia cost the state’s top four building companies close to $130,000 in one month.2 Australia-wide estimates of the direct costs of construction crime are in the region of $2B/year with the National Equipment Register estimating that around $650m worth of high-cost construction equipment is stolen each year3.
The likelihood of theft or vandalism in construction and building is high and growing, and the consequences can be crippling. The impacts can include both the direct costs of labour and materials in replacing damaged or stolen assets as well as the indirect and consequential costs associated with delay, interruption and management attention. Statistics gathered from Spectur customers in the first quarter of FY2020 indicate an average cost of construction crime in excess of $30,000, with maximum costs in excess of $200,000 for one event.
So what are the options for construction and building contractors to deal with this very real and growing threat?
The first option (sadly too common) is the “do nothing” and hope for the best. The hard reality is that the odds of an incident are much higher at your building site than in your drive to the building site (in your insured vehicle). Construction and building theft and vandalism is a case of when and how bad, not if it will happen.
Real solutions that you can implement to reduce the likelihood of construction and building site crime include:
- Fences and locks. Almost the price of entry (pardon the pun). Without some form of physical barrier, there is nothing to deter trespass within your site. These barriers can be surpassed through and generally have to form part of a broader solution for higher-value targets.
- Most events occur after hours when the sites are empty and at night. Providing lighting does reduce the opportunity for offenders to be operating unseen. When combined with other monitoring solutions, lighting can be a worthwhile investment.
- Conventional financial insurance. This does not reduce the likelihood of an event but can mitigate the consequences of direct costs. Ultimately, increasing premiums or excess can make this alone insufficient or not cost-effective.
- Guard patrols or dogs. These can be very effective when operating but suffer from very high costs and the problem of absence (usually they are not always present).
- CCTV camera systems. There has been growth in the number of systems and affordability of these passive systems in the last decade. CCTV, if installed and operated correctly, can provide high-quality images of a crime that has already been committed – but they don’t stop it. Unfortunately, the opportunity to recover the costs via translating these images into arrests and productive compensatory actions is extremely low.
- Active remote security, surveillance and deterrence systems such as the Spectur HD5. When combined with artificial intelligence and a monitoring service, these systems can autonomously detect, alert and deter intruders 24/7 with low false alarms at a fraction of the cost of guard patrols. Spectur statistics have indicated that when a system such as the HD5 is deployed, the incidence of recurrence of crimes is reduced by more than 90% and average costs in these limited occasions reduced from more than $30,000 to less than $5,000.
Prior to installing a Spectur system, typical Australian construction or building contractors will spend a weighted average of $12,000 per year to protect against theft and damage. Builders and constructors with Spectur systems on their sites have theft and damage costs that on weighted average reduce to less than $500 per year, for less than $14 per day (rented)* or $8/day (purchased)+. That is cost effective insurance.
Any one of these options may not be the silver bullet, but through a combination of solutions, you can take charge of your security. To reduce the likelihood and the consequences of construction and building site crime in a way that makes even more sense than insuring your car, click here to find out more.
* Based on the rental of a single system over a short period. Longer term rentals can be available for as little as $9.75/day + installation fee.
+ Based on a purchased system. A fully installed HD5, with premium SpecturCare service charges, depreciated over three years can be less than $7.30/day.