Construction Risk Management Plan Template

What is a Construction Risk Management Plan?

A construction risk management plan sets the rules a project's risk process runs under: who owns risk, how it is scored, what each role may decide, when it escalates, and how contingency is drawn. It is approved once and reissued when the thresholds or the delivery method change.

It is not the risk register. The project risk register is the live list of individual risks, maintained continuously. The plan is the rules that register runs under, and where the two disagree the plan governs and the register is corrected.

Written owner side, it binds everyone named in it, plus every consultant and contractor to the extent their agreement incorporates it. A named risk owner cannot decline the role by not looking at the register.

Construction Risk Management Plan Example

Here is a good example of a construction risk management plan, written for a $48 million hospital patient tower expansion delivered under Construction Manager at Risk.

Construction Risk Management Plan Template: Key Elements

Eleven sections, from purpose through to approval.

State which risk matrix is in use, either a 5x5 risk matrix or a 4x4, and do not change it mid-project. A project that switches grid partway loses its trend data.

How to Make a Construction Risk Management Plan Using This PDF Template

Set the thresholds before anything else. Decision authority, the scales and the escalation triggers are three statements of the same delegation, so they have to match.

1. Complete the cover with the construction value, contingency held, owner float, the risk matrix in use and the delivery method.
2. Name every role and the dollar value each may accept, approve or draw down.
3. Set the likelihood bands as percentages and the consequence scale in dollars, days, injury outcomes and reputation.
4. Set the project's risk tolerance for cost, schedule, safety, quality and reputation.
5. Confirm the process steps and who does what at each one.
6. Set who may approve each of the five responses, and at what value.
7. Write the contingency rules, including what triggers a reportable exception.
8. Build the escalation table, and check every threshold in it against the decision authorities and the scales.
9. Set the review cycle, including a re-identification workshop at each stage gate.
10. Re-test the owner-risk list against your delivery method, then approve and issue.

Replace every threshold before you issue. A plan carrying another project's dollar figures is worse than no plan, because people will act on it.

The treatment actions themselves live elsewhere. This plan sets who may approve each response; a risk mitigation plan template records what was actually done, with dates and costs.

A plan sets thresholds; it cannot enforce them. Construction risk management software holds the matrix, categories and descriptors at system level, so every project scores against the same one.

The Risks an Owner Cannot Transfer

Nine risks stay with the owner whatever the contract says. Most published risk lists cover safety, weather and cost overrun, which are contractor risks.

• Permitting and entitlement: A contractor can prepare the application; it cannot guarantee the decision or its timing.
• Site availability and access: Utility relocations, easements, existing occupants, environmental clearance.
• Funding drawdown and appropriation timing: A bond sale or fiscal-year appropriation moves on its own calendar.
• Your own decision latency: Submittal reviews, change order decisions, selections, sign-offs.
• Stakeholder and community objection: Usually a schedule and reputation consequence rather than a cost one.
• Operational readiness: Staffing, training, FF&E, IT, the move.
• Existing conditions and hazardous materials: A differing site conditions clause converts a discovery straight into a change order.
• Interfaces with your own operations: A contractor can be held to a schedule, not to your operational calendar.
• Design adequacy, where you supplied the design: Under the Spearin doctrine an owner furnishing plans and specifications impliedly warrants they are adequate.

Design adequacy moves with the delivery method: default under design-bid-build, shifted under design-build, negotiable under Construction Manager at Risk. Give each of these a named owner.

Setting Risk Thresholds in Dollars and Days

A likelihood scale with no percentages and a consequence scale with no dollars is why two people score the same risk three levels apart.

Likelihood needs probability bands: almost certain above 80%, likely 50 to 80%, possible 20 to 50%, unlikely 5 to 20%, rare below 5%.

Consequence needs four columns, not one. Cost in dollars, schedule in days, safety in injury outcomes, reputation in who hears about it. A community objection scores near zero on a cost-only scale and then stops the project anyway.

Tolerance is separate. The scale says how big something is; tolerance says what the project will carry. Safety is usually the row with no dollar figure against it.

Related Articles and Templates

Explore these resources for construction risk identification, assessment, treatment, and ongoing risk management:

• The Ultimate Guide to Construction Risk Management
• Risk Assessment Template
• Risk Workshop: Run Better Risk Sessions in Projects
• What is a Risk Register? Guide + Example
• What Is a Risk Response Plan?
• 7 Steps of Risk Management Process (RMF) with Example