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The paper discusses different types of risks availed by different parties so that raw data for proper risk allocation can be collected. Next section of the paper elaborates risk assessments and evaluation processes which are quite essential for the project manager to carry out as it help in prioritizing of different types of risks before allocating them.
The paper contains the discussion under following heads:-
1. Executive Summary
2. Introduction to the Subject
3. Paper at a Glance
4. Construction Contracts
5. Parties Involved
6. Types of Risks in the Construction Contract availed by Parties involved
7. Allocation of Risk in Construction Contract
8. Risk Allocation in Construction Contract by Disclaimer Clauses
9. Role of external parties involved in construction contract for diversification of risk
10. Role of internal parties involved in construction contract for diversification of risk
In a contract, allocation of risk in a contract is done on the basis of frequency of the occurrence of risk in a project and severity of the impact of the risk over the project. For the purpose of allocating risk in a project, there is a need of including a disclaimer within the construction contract which is designed for the purpose of shifting risk from one party to another in the legal manner.