Covering your contract materials against loss or damage
What is Contract Works Insurance?
Contract Works insurance is important for builders, tradies and sub-contractors who have a responsibility for the contract materials of any particular project. If you would be held liable in the event of loss or damage to the contract materials of your construction job, you will need to consider Contract Works insurance.
Materials may be lost or damage by any number of perils, including: fire; weather events (storm, water, flood, wind, lightning, etc.); malicious damage; accidental damage; theft; impact and the like.
The policy can also be packaged to include your Public & Products Liability risks, covering your legal liability for claims or personal injury or property damage arising from your business activities or products.
Policies may be purchased for single projects or on an annual basis where multiple projects will be carried out during the annual period of insurance.
Who should consider it?
Typically purchased by builders who are responsible for the build until handover (think of all the materials that go into building a house – timber, concrete, gyprock, tiles, fixtures & fittings and the like) it should also be considered for other trades and projects as well. For instance, the installation of security systems; large plumbing or electrical jobs; the manufacture & installation of awnings; shop fitters; mechanical installations and similar such projects.
Owner-builders will also need to consider Contract Works insurance to cover the building whilst under construction. Being responsible for the overall project you are also responsible for people coming onsite and will need to include Public Liability to protect you against claims of injury or property damage whilst people are on your site. Note your home & contents policy will not cover construction activities.
Did you know:
The most common types of losses under a Contract Works policy is from:
- Theft of building materials.
What can it cover:
- Physical loss or damage to contract materials
- Testing and commissioning cover
- Defects liability cover
- Transit and off-site storage of project materials
- Existing structures
- Contractors plant, tools and equipment
- Scaffolding, formwork and hoardings
- Removal of debris
- Public & Products Liability
- Property in your Care, Custody & Control
What isn’t covered:
- Cessation of work (i.e. if you stop construction for a period of time)
- Wear, tear, corrosion and deterioration
- Professional services
Some sections of cover will be optional and will not be covered unless requested by you and agreed by underwriters.
Other exclusions will apply and you should review any quote received carefully and consider the policy wording for all policy terms, conditions, exclusions and limitations.