Why is it important for Tradesmen to have Contractors’ All Risks Insurance
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Contractors All Risks Insurance (also known as Contract Works or CAR insurance) is insurance designed for builders or contractors working on construction projects including buildings in the course of Construction, Alteration or Refurbishment.
Contractors All Risks insurance can be a once-off or an annual policy depending on your requirements or those of your hirer. It can be incorporated in a combined policy along with your Public and Employers Liability and also include cover for damage to property as a result of contract works, site materials, own plant, hired-in plant and employee’s tools.
The policy is designed to cover ‘work in progress’ and the main part of Contractors All Risks insurance is the contract works section which provides cover for the property being worked on (e.g. new house, renovations etc.). However, cover for the existing property is excluded (e.g. the existing structure when building an extension) and this aspect must continue to be insured under the owners’ building insurance policy.
It is a common misconception that the Builder covers my property when he is renovating / extending it. It is also often the case that the owner has not notified his building Insurer of the works and this could lead to absolutely no cover in the event of damage caused to the existing structure during the works.
Typical contract trades for Contractors All Risks insurance cover would be General Building Contractors, Heating & Plumbing Installers, Double Glazing Installers, Electricians, Shop Fitters, Brick-layers Carpenters/Joiners, Plastering/Partitioning/Dry Lining and Floor/Wall Tiling Contractors and more.
Wherever there is the construction of buildings or domestic works, there is a risk of loss or damage. The contract/agreement governing the works will place the responsibility for this loss or damage with either the Contractor or Employer (Owner). A Contractors All Risks insurance policy can protect either party against the cost of this loss or damage.
Contractors All Risks Typical Key Features;
- Cover for damage to permanent and temporary works and materials, whilst on site and whilst in transit to and from site.
- Off-site Storage up to a percentage* of the Contract Price (*percentage varies Insurer to Insurer)
- Cover for Owned and Hired in Plant and Equipment.
- New Builds – up to 12 months cover after completion for contractual obligations forming part of the maintenance or defects liability period.
- Contents for Show houses can be included
- Cover for any party that is required to be a joint named insured under the contract
- Professional fees and Debris Removal
- Fire Brigade Charges
Remember: Contractors All Risks Insurance provides All Risks cover for you for contract works, plant, machinery, equipment & temporary buildings for which you are legally responsible, usually while working on a specific construction contract. The Sum Insured should be the replacement cost and in respect of contract works/buildings, the sum insured should include the cost of Debris Removal & Architect/Surveyors Fees.
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