CONSTRUCTION INSURANCE
OUR EXPERIENCE WITH CONSTRUCTION INSURANCE
We have looked after the Insurance needs of Builders and associated Trades for over 25 years. With Material prices continuing to surge and supply chain shortages, Builders are under increasing pressure to deliver projects on time and on budget. Having adequate Insurance provisions in place has never been more important.
WHAT DOES CONSTRUCTION INSURANCE COVER
Contract Works or Construction Works Insurance, which includes cover for Material Damage and Legal Liability, can cover Builders, Tradespeople and their subcontractors. This cover can extend to cover risks of fire, theft, malicious damage, storm, hail, cyclone, flood and accidental damage during a construction period. This construction could be a new home or Building or even a renovation or extension to an existing structure. A Contract Works policy can also provide “Existing Structure” cover where required as typically significant works to an already established home or building can render its current insurance arrangement null and void.
The Construction Site continues to be one of the highest hazard environments here in Australia.
It is important that you speak with one of our skilled Client Managers to ensure we understand your Business and Insurance needs and can source an appropriate Insurance solution.
WHO NEEDS TO TAKE OUT CONSTRUCTION INSURANCE
Any Builder, Contractor, Handyman or even Property Owner can take out a Contract Works Insurance Policy providing Building or Construction works are taking place. This policy is deigned to cover the typical range of exposures encountered whilst construction is underway. The risks presented in this environment differ from other worksites so it is especially important that the appropriate Insurances are in place especially in the case of a claim.
Whether it be a greenfield site, a significant renovation or development, or a large-scale installation of appliances or accessories a Contract Works policy can be tailored to meet your Insurance needs prior to “Practical Completion” or “Handover”. This can be an annual policy which is based on estimates and subject to an annual adjustment, or it could be job specific.
DOES ATLANTIC ASSIST WITH CLAIMS
Over time Atlantic’s Client managers have developed a strong understand of your insurance needs, expectations and the exposures you face during a Building Project.
We believe it is important that the same contact point who negotiated your Contract Works or Construction Works Insurance Policy is also your advocate in the case of a claim. Your Client Manager will assist in the collection of relevant information, supporting documentation and assist with the approach to the Insurer on your behalf. During the process they will work with any assessors appointed on behalf of the Insurers and will also liaise with any other parties to ensure the outcome meets expectations and is fair and reasonable.
WHAT POLICY EXTENSIONS / ENDORSEMENTS MAY BE RELEVANT TO CONSIDER
We are experiencing a surge in renovations to existing structures in which case the Material Damage component of the cover can extend to include existing structures. This is crucial as there is often a misconception that existing structures will remain covered under existing property, home or business policies which is not the case. It is important the Insurer fully understands the nature of the existing structure to avoid any unnecessary complications in the case of a claim.
The right Contract Works Policy can also extend to cover a range of other assets commonly located on a Construction site. For example, fencing, scaffolding, temporary structures, toilets and tools. It can also include a provision for Materials that need to be stored offsite and can provide coverage for them in transit to and from the job site.
Some other endorsements / extensions we commonly discuss with our Clients include:
- Principal Supplied Materials
- Variations & Escalations
- Removal of Debris
- Professional Fees
- Pollution Liability
- Mitigation Costs
- Principal Supplied Items
- Vibration, Weakening, Removal of Support
CURRENT CLAIMS LANDSCAPE FOR CONSTRUCTION INSURANCE
The Material damage component of a Contract Works Policy is always front of mind as these are the loses we typically see or hear about. The Personal Injury cover that is typically purchased in-line with Material Damage is equally if not more important. There is no doubt we continue to see an increase in legal action and recoveries across most industries and especially Construction. Writs and Recovery actions are commonplace and claims compensating for pain & suffering, loss of Lifestyle, loss of Income and loss of future earnings are not unusual.
Incidents involving workplace injury are being closely examined and are more frequently leading to legal proceedings. For entities in high hazard industries such as Building, a Management Liability policy is becoming a more common Insurance purchase. Not only does this provide the Owners of the Business with a level of protection via the Director and Officers cover, it also contains provisions to assist in instances of potential Employment Practices Liability claims and potential breaches of Occupational health and safety regulations which often remain undiscovered until after a claim and the intervention of a regulatory authority.
FAQ's
A Contract Works policy can have a tools provision included with the coverage. This will have coverage requirements, ie. stored within a locked box etc and it is important you are able to provide evidence of your loss with supporting documentation and photographs if applicable.
The Liability Section of a Contract Works Policy contains provisions to assist you with a defense in relation to Workcover Recovery claims. This type of defense can often be protracted and expensive.
If the Assets belong to you and form part of your contract to install, then you need to replace them. The Contract Works policy will enable you to replace these items.
This style of loss prior to practical completion or handover together with the reinstatement of these assets can be covered under a Contract Works policy.
Most Contract Works Policies include coverage for Materials stored offsite and can also extend to include coverage during transit to the site.
An annual Turnover policy extends coverage to all projects for a 12 month period. This removes the risk of overlooking the Insurance attaching to a project. Our experienced Client Managers will be able to provide advice on the different ways to declare projects for this 12 month period. A single project covers only one project at a time and coverage is specific to that project.
You are able to include a component of Principal supplied Materials under a Contract Works Policy to ensure if there is a theft of these items prior to completion and handover, the policy will respond.
