This study goals to develop a model for predicting financial loss at construction sites using a deep learning algorithm to reduce and prevent the risk of financial loss at construction sites. Lately, as the construction of high-rise buildings and complex buildings increases and the scale of construction sites surges, the severity and frequency of accidents occurring at construction sites are swelling, and financial losses are also snowballing. Singularly, as natural disasters rise and construction projects in urban areas increase, the risk of financial loss for construction sites is mounting. Thus, a financial loss prediction model is desired to mitigate and manage the risk of such financial loss for maintainable and effective construction project management. This study reflects the financial loss incurred at the actual construction sites by collecting claim payout data from a major South Korean insurance company. A deep learning algorithm was presented in order to develop an objective and scientific prediction model. The results and framework of this study provide critical guidance on financial loss management necessary for sustainable and successful construction project management and can be used as a reference for various other construction project management studies.

Tunnel construction, a common byproduct of rapid economic growth and transportation-system development, carries inherent risks to life and various kinds of property that operations and management professionals must take into account. Due to various and complicated geological conditions, tunnel construction projects can produce unexpected collapses, landslides, avalanches, and water-related hazards. Moreover, damage from such events can be intensified by other factors, including geological hazards caused by natural disasters, such as heavy rainfall and earthquakes, resulting in huge social, economic, and environmental losses. Therefore, the present research conducted multiple linear regression analyses on financial-loss data arising from tunnel construction in Korea to develop a novel tunnel-focused method of natural-hazard risk assessment. More specifically, the total insured value and actual value of damage to 277 tunnel-construction projects were utilized to identify significant natural-disaster indicators linked to unexpected construction-budget overruns and construction-scheduling delays. Damage ratios (i.e., actual losses over total insured project value) were used as objective, quantitative indices of the extent of damage that can be usefully applied irrespective of project size. Natural-hazard impact data—specifically wind speed, rainfall, and flood occurrences—were applied as the independent variables in the regression model. In the regression model, maximum wind speed was found to be correlated with tunnel projects’ financial losses across all three of the natural-hazard indicators. The present research results can serve as important baseline references for natural disaster-related risk assessments of tunnel-construction projects, and thus serve the wider purpose of balanced and sustainable development.

Given trends in more frequent and severe natural disaster events, developing effective risk mitigation strategies is crucial to reduce negative economic impacts, due to the limited budget for rehabilitation. To address this need, this study aims to develop a strategic framework for natural disaster risk mitigation, highlighting two different strategic implementation processes (SIPs). SIP-1 is intended to improve the predictability of natural disaster-triggered financial losses using deep learning. To demonstrate SIP-1, SIP-1 explores deep neural networks (DNNs) that learn storm and flood insurance loss ratios associated with selected major indicators and then develops an optimal DNN model. SIP-2 underlines the risk mitigation strategy at the project level, by adopting a cost–benefit analysis method that quantifies the cost effectiveness of disaster prevention projects. In SIP-2, a case study of disaster risk reservoir projects in South Korea was adopted. The validated result of SIP-1 confirmed that the predictability of the developed DNN is more accurate and reliable than a traditional parametric model, while SIP-2 revealed that maintenance projects are economically more beneficial in the long term as the loss amount becomes smaller after 8 years, coupled with the investment in the projects. The proposed framework is unique as it provides a combinational approach to mitigating economic damages caused by natural disasters at both financial loss and project levels. This study is its first kind and will help practitioners quantify the loss from natural disasters, while allowing them to evaluate the cost effectiveness of risk reduction projects through a holistic approach.

There are many risks and uncertainties in plant construction projects, because of their complexity, difficulty in loss prediction and size of construction being large. The risk management of such plant construction projects should not be relied solely on the experiences and intuition of the contractors or the construction managers as it has been in the past. For that reason, a new quantitative and empirical risk analysis is required, in order for the development of a+65 risk assessment using risk indicators for the plant construction projects. This research used the insurance payout record from a global insurance company to reflect the actual quantitative loss in the risk assessment model for plant construction project. The researchers adopted the geographic information as well as construction information, (construction phase and commissioning phase, process rate, total duration) as the independent variables, which found to be statistically significant in the analysis in this study. In the analysis, in which the researchers adopted the geographic information and construction information as the independent variables, it was found that, as the relationship between damage ratio and the valid variables were identified as statistically significant, the damage function model is statistically significant. This research suggests that the regression model containing such valid independent variables could be beneficial in terms of providing foundational guidelines for the plant construction project risk analysis.

The purpose of this study is to suggest a quantitative risk assessment approach for construction sites using risk indicators to predict economic damages. The frequency of damage in building construction has recently increased, and the associated costs have been increased as well. Although a request for a damage estimation model has been extended, the industry still lacks quantitative and comprehensive research that reveals the physical relationship between damage and risk indicators. To address that issue, we use an insurance company’s payouts from construction site claims in South Korea to reflect the real financial damage. We adopted a multiple regression method to define the risk indicators: geographic vulnerability, natural hazards, capability, and general project information. The results and findings of this research will be accepted as an essential guideline for developing a construction risk estimation model.