Most insurance policies that provide cover for damage to buildings specifically exclude damages caused by contractors on site. This means that the moment any tool is lifted to attend to a repair, improvement or extension, cover ceases when any damage arises as a result of contract works. It is not uncommon for flooding events caused by contractors who accidentally hit a water supply pipe or dropped a heavy piece of tooling onto a tiled floor or through a ceiling. These are just a couple of examples of what could go wrong with contract works on your property.
While a handful of insurers may provide limited cover in these circumstances (accidental damage), it is best that you seek confirmation and advice from your broker when considering this cover. Contractors All Risk insurance cover can be acquired via specialist engineering risk underwriters.
There are a number of exposures to consider here:
- The value of the contract, including material on site.
- Possible damage to the immediate building area being worked on.
- Possible damage to surrounding property (e.g. spread of fire).
- Public liability – personal injury or damage to moveable property belonging to third parties.
- SASRIA cover – damage caused to property due to labour disturbance or civil unrest.
Most reputable large building contractors, painting or waterproofing contractors and roofing contractors hold their own policies to cover for these potential risks. It would be prudent to ask for a copy of the contractor’s insurance policy for comfort, should you – as property owner – be concerned. Should a contractor not hold any cover, the property owner may make application for their own policy for a specific contract term at a once-off advance premium.
Author: Brian Addison
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