Drawdown Claims Hit Months After You Demobilize
The job wrapped in spring, the margin got spent, and in the fall a neighbor calls about cracks in their slab and a well that quit producing.
Your pumping changes the soil under property you were never hired to touch, and no other trade on the job has that exposure. The claim also runs on a delay, because settlement develops over months while your job closes in weeks. Subsidence and earth-movement exclusions are common in general liability coverage, so the one claim your trade is most likely to see is the one your policy may be written to sidestep.
The size of it
A claim with no reserve behind it hits a job you already closed, and you defend it out of current-year cash, possibly outside coverage.
Lowering the water table raises effective stress in the surrounding soil. Adjacent structures on shallow foundations settle and crack, and neighboring shallow wells go dry. The damage develops over time, so it turns up long after the system is pulled and the job is closed, by which point the money is spent. Practitioners describe pumping that caused a neighboring building to collapse. Liability attaches to your means and methods, and the Engineer's review of your submittal expressly doesn't relieve you of that.
Three moves, in order
Step 03: Overhead calculation
What indirect cost really comes to at your size, and the rate your estimating template should be using.
What else costs dewatering contractors money
The same mechanism in other trades
What dewatering owners ask
Neighbor settlement claim months after dewatering job closed who is liable?
The job wrapped in spring, the margin got spent, and in the fall a neighbor calls about cracks in their slab and a well that quit producing.
What does it cost?
A claim with no reserve behind it hits a job you already closed, and you defend it out of current-year cash, possibly outside coverage.
What do I do first?
Make a pre-condition survey standard on any job with structures or shallow wells inside the drawdown radius, including dated photos, elevations, and well yields where you can get them. File it with the closed job records where you can find it years later.
What are dewatering contractors supposed to be making?
No survey separates dewatering, so there is no figure of its own. The nearest comparable trade in the reference is Excavation, which runs 21% gross margin, 14% overhead and 7% net profit before taxes at $1M–$5M, with a CFOS target of 10.5% net. Those are derived figures, not dewatering's own. Read them as the neighbourhood, and read your own job costing as the answer.
Which part of the system fixes it?
The step is number 03, overhead calculation. What indirect cost really comes to at your size, and the rate your estimating template should be using. It comes from chapter 3 of CONTROL: The Construction Financial Operating System.
Everything on this page is something you can install yourself, andCONTROL is the order to do it in. If you would rather buy the finished result, SPM The Construction CFO does this work for dewatering contractors as a service. It is a separate firm, Sulphur Prairie Management, LLC, run by the same author.
Wrote CONTROL, the 8 step system behind these figures. More about the author.