contactor claim strategy

Claim Strategy: 6 Tips for Contractors

If you find yourself in a position where you need to prepare a claim, you will also need a claim strategy. Good news: Our involvement in countless claims over the years means we have a long list of key things you need to think about before you decide the way forward:

The Value of the Claim

Firstly, are you entitled to additional payment? Secondly, does the amount justify the time and effort needed to prepare and submit the claim? And finally, will the submission of small claims for each and every event on the project affect business relationships?

The Strength of the Claim

Is the contractor’s contractual entitlement clear-cut? Or is the event open to interpretation by the other side? If the claim could be contested, it may only be worth submitting it if it’s a high-value claim.

Negotiation Margin

In some cultures and regions, no one ever pays the first price received. Negotiation may be expected. In others, it is more appropriate to submit a strong claim based on the contractor’s view of their entitlement, with little negotiation margin. You need to decide which approach to take, depending on the environment you’re working in.

The Person Responsible for Responding to the Claim

Does the responding party have well-qualified and experienced resources to deal with claims? Or will the claim be examined by someone with little experience? Both scenarios will come with their own challenges. An experienced professional will quickly highlight weaknesses in the claim. They may reject or reduce the value of the claim fairly easily. In such a case, it will be necessary to produce a robust submission to a good professional standard.

A less experienced professional is likely to look for excuses to reject the claim. They may not have the confidence to make an award. You may need to force their hand by giving no opportunity for rejection. Contractors should also bear in mind that the employer may bring in experts to examine high-value claims.

Suitable Resources to Prepare the Claim

Do you have experienced resources available to prepare the claim? If not, and if it’s a high-value claim, consider bringing in additional support.

Client Relationship

Claims are usually bad news to clients. As a result, it’s prudent to keep your relationship in mind and how you can maintain it. This applies both to your current project and in future. Would it be a good idea to submit low-value claims? Or, would it be better to restrict claims to serious issues and ensure you only claim a fair and reasonable amount? Above all, you must convince the employer that you are only asking for what you are entitled to. Ensure you can justify and substantiate your claim.

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