Why Construction Risk Management Must Move from Paper To Practice

The recent collapse of a multi-storey building in Nairobi’s South C is yet another grim reminder of Kenya’s long and painful history of preventable building failures. Sadly, this tragedy is not an isolated incident, but part of a recurring pattern that continues to claim lives, destroy livelihoods and erode public trust.

A few years ago, a building under construction collapsed at the junction of River Road and Ronald Ngala Street in Nairobi, killing scores of workers and passers-by. Before that, in 2016, a six-storey residential building came down in Huruma Estate, killing at least 49 people, many of them women and children. We could go on and on.

Across these incidents, the warning signs have been strikingly similar: poor workmanship, use of substandard materials, blatant disregard for approved designs, and most critically, regulatory failure. These are not acts of fate, rather they are failures of systems, discipline and accountability.

While insurance does not prevent buildings from collapsing, it plays a critical role in mitigating the consequences when things go wrong. Before issuing covers such as Contractor’s All Risks (CAR), Public Liability or Workers’ Compensation, insurers typically require a project to undergo technical risk assessments. These assessments review key aspects of a project, including approved architectural and structural designs, soil and geotechnical reports, contractor qualifications, construction methodology, safety procedures and regulatory approvals.

If a project does not meet minimum risk and compliance standards, insurers can decline cover, impose exclusions, or require corrective actions before cover is granted. This creates a strong incentive for developers and contractors to comply with approved designs and statutory requirements, since operating without insurance exposes them to severe financial and legal risk.

This gatekeeping role is vital. It helps minimize, or altogether eliminate, the kind of chaos witnessed in South C, including shortcuts such as bypassing approvals to vary designs during construction. Crucially, insurers assess design variation controls. Any changes to approved plans—such as adding floors, altering structural elements or modifying load-bearing components—must be supported by revised approvals and engineering certifications. Projects that bypass approvals or implement unauthorised design changes are flagged as high-risk and may be rendered uninsurable.

In the words of the Architectural Association of Kenya (AAK) put it, the 14-storey South C building was an unavoidable tragedy caused by persistent non-compliance in the development control process.

Construction is inherently a high-risk business. Every project is unique, with its own set of technical, financial, environmental and operational challenges. Identifying and managing these risks is not always easy, but it is far from impossible with careful planning and disciplined execution. When risk turns into reality, it can derail an entire project, damage reputations and, tragically, cost lives. That is why construction risk management is not optional, but essential.

Effective risk management requires the ability to properly assess, control and continuously monitor risks once they are identified. Importantly, risks are not always negative ad when well-managed, they can lead to increased profitability, stronger client relationships, repeat business and expansion into new markets and sectors.

At its core, risk management in the construction industry is planning, monitoring and controlling measures designed to prevent exposure to risk. This involves identifying hazards, assessing the extent of the risk, implementing control measures and managing any residual risks. It is a fundamental part of project planning and execution.

Keep in mind that construction projects are exposed to a wide range of risks, including financial, environmental, socio-economic and construction-related. The industry’s volatility is heavily influenced by external factors such as design changes, logistics challenges, physical site conditions, operating environments, environmental concerns and socio-political dynamics. Any of these can derail a project or create dangerous deviations if left unchecked.

Risk management, therefore, becomes a pivotal instrument for identifying these threats, analysing their potential impact and implementing remedial measures before disaster strikes.

The benefits of effective risk management include streamlined operations, enhanced safety, building confidence among investors and clients, and ultimately improving profitability. In an industry where workers routinely operate at height, handle dangerous machinery and perform tasks in hazardous environments, robust risk management procedures are critical to protecting employees, contractors and site visitors.

Read Also: Bamburi Cement inks Kshs 32 Billion Greenfield Clinker Factory Construction Agreement

By Francis Maina, the Deputy Director, Minet Risk Solutions, at Minet Kenya