Planning a major building project? Then you’ll need to make sure you’ve got the right insurance for building works.
While most of us understand the need to insure our homes, and buy annual building and contents cover, not many home owners realise that they may also need need extra insurance for building works.
Your Insurance for Building Works
Whether you’re planning an extension, a renovation or a conversion, insurance is a key part of the pre-construction planning process. You need to make sure that you have organised the various types of insurance that will cover not only the building works themselves, but also the existing structure(s) while the construction work progresses.
The first thing to do is speak to your current home insurer. Inform them of what building works you plan to do. Different insurers will have different approaches to construction projects. They’ll also have different requirements depending on the value of the works, the size and scope of the project and whether you are still living in your home during construction.
You should expect to have any, or all, of the following applied to your home insurance policy. They will be effective from the start of the works:-
1. An increased excess
2. A reduction in cover
3. An exclusion for any claims caused by the contractors
You may find that your standard household insurer will not cover the property whilst works are ongoing. This is particularly common if you are moving out of the property for the duration of the works, or the building project is of a particularly high value. In these circumstances, you will need to arrange cover via a broker who specialises in unoccupied property insurance.
As construction project consultants we have worked on dozens of very large projects which need specialist building insurance. We can therefore help put out clients in touch with insurers who can advise them on the policies they will require for their building projects.
Your Contractor’s Insurance for Building Works
Your contractor should have the following insurances in place when undertaking work on your extension or renovation:-
1. Public Liability
This covers injury and death to third parties, as well as damage to third party property e.g. tile falling off your property’s roof onto your neighbour’s car.
This comes in varying Limits of Indemnity generally £1 million, £2 million, £5 million and £10 million. You should make sure that you are comfortable with the level of cover. Do not be afraid of asking your builder to increase it for your project!
2. Contract Works
This covers the value of the works being carried out as stated in the contract. It includes cover for materials left on site purchased by the contractor, but NOT by the client, subject to conditions related to site security as per the contractor’s insurance policy.
Again, do not be afraid to ask for a copy of their policy for your peace of mind.
3. Plant Cover
It is also worth checking that any Plant (eg. diggers, cement mixers etc.) has adequate insurance cover, either via the contractor’s insurance or from the hiring company. This may seem irrelevant, however theft of Plant can lead to delays to the project programme, which in turn can mean higher costs for you!
4. Employer’s Liability
Whilst this is not your responsibility, an accident on site involving employees of the contractor can get messy from an insurance perspective. This can in turn lead to project delays. It is therefore wise to check the contractor’s policy thoroughly before signing your building contract.
How We Can Help You
Fundamental to a successful building project is the selection of an appropriate builder and the drawing up of an appropriate building contract. If you carry out a thorough competitive tender, using CLPM, we will help ensure that the builder has all the appropriate insurances in place. We can also help put you in touch with a suitable insurer for specialist cover for your home.
CLPM offer a variety of construction cost related services such as project cost estimating, budgeting, competitive tendering and contractor appointment. All of our services are available separately to enable you to tailor our services around your needs and budget.
If you’re planning a building project and you’d like to understand more about how we can help then do get in touch.
Call 01923 896550, email email@example.com or complete a contact form.