Why does a Builder need Contractors All Risks Insurance?
When a builder is constructing a property what they will need to realise is that they will be responsible generally for the structure they are building until they hand it over to their clients. So in the case of damage to the property they are constructing from the likes of a Fire ,Storm , Flood , Malicious damage the builder will be responsible for making good damage caused by these perils until the property is handed over to their clients
The policy will pay for repair or replacement of the insured works following damage caused by an insured event.
What does a Contractors All Risk Insurance policy cover?
The cover is quite wide and like the name suggest covers ‘All-risks’ of damage to the insured works unless caused by an exclusion contained in the policy.
Insured works are the permanent and temporary works that the builder will be carrying out for the year when they take out the policy. In most cases these policies are annual and an annual disclosure of the type works / nature /maximum values and turnovers are given to insurers at policy inception.
When you pick a sum insured it should be the maximum value of any contract that will be undertaken and should pay heed to things like professional fees, debris removal, local authority requirements and free issue materials.
Just on the above, you can also arrange a one off single contract cover – sometimes done for large projects.
Temporary site buildings may be covered as well and you usually need specify a sum insured for these
Within the policy cover the INLAND transit risk of material coming to site is also covered – Policy doesn’t cover materials that are transported by sea or air.
Cover on policy stays in force until, in the case of short period policy, the period expires or the cert of completion is issued (whichever is first) and in the case of annual policies cover ceases once the cert of practical completion is issued.
In the event of loss or damage to the works during any maintenance period happening the liability for this is usually covered, subject to a specified time limit, which is normally 12 months.
Contractors All Risks policies, where the builder wants to insure their own or hired in plant, can be extended to include loss or damage to this equipment.
Own plant is covered on an All Risks basis similar to the works and when arranging the cover, the builder should ensure that the sum insured is adequate to cover replacement of same. Claims on plant can be reduced to take into account wear, tear and betterment.
You can cover your liability for loss or damage to hired in plant.
Often under hiring conditions the hirer will be responsible for loss or damage to the plant hired in AND indeed continuing loss of hiring out charges that the company that Plant Hiring Operator would incur when their plant is damaged / destroyed and not being able to hire same
If you select this item on your covers the policy may offer you /or may impose on you a limit on any one claim & any one item. So important that you understand your liabilities and maximum exposures. The extension for ongoing hire charges cover should be enough to cover your exposure for the lost hiring charges the Plant Hire Company would lose in event of a loss.
Typical Exclusions in Contractors All Risk policies would be:
Professional negligence risks
Loss of Revenue
Cost of repair or rectification due to defective design, plan, specification, materials or workmanship
Wilful act or neglect
This is a document for guidance only and should be treated as such. Burke Insurances accept no responsibility for the contents of this document.
To find out more about Contractors All Risks insurance call the team at Burke Insurances now 091-563518.
Get a quote now – https://www.burkeins.ie/combined-liability/