In this paper, the effects of uncertainties of smear zone characteristics induced by installation of prefabricated vertical drains on the preloading design are numerically investigated. FLAC 2D finite difference software with additional developed subroutines has been employed to conduct the numerical simulations. The finite difference analyses have been verified using a case study. Furthermore, a comprehensive parametric study is conducted to investigate the influence of smear zone permeability and extent on the model predictions. Results of this study indicate that the assumptive properties for smear zone characteristics may result in inaccurate predictions of ground deformations and pore water pressures. This may lead to early removal of the surcharge in the construction process causing excessive post construction settlement. It is recommended to practising engineers to use results of trial preloading to back calculate the required smear zone characteristics in the early stages of embankment construction to optimize the design