A contract works insurance is useful to people in the business of construction and similar tradesmen. It is meant to cover ongoing work on a site and includes certain events that are insured under this coverage. Some of them are theft, vandalism, storm, or flood. In the case of these events’ occurrence, the insurance covers for repairing or redoing the works that were in progress.
Who needs it?
For deciding whether to take out a contract works insurance policy, you need to go through your client contracts. As you do that, you will find if you are held responsible for any unfinished work of your contracts. Only after that can you decide to sign up for a contract works insurance.
Usually, the people who need to take this kind of coverage are property developers, carpenters, tilers and plasterers, bricklayers, electricians, or building contractors. This insurance can be of use to pretty much everyone involved with the construction industry or someone who needs to ensure work in progress.
What is covered?
Contract works insurance provides coverage for the work happening on a building site. The cost of repairing or redoing the damaged or destroyed work are covered through this insurance. Also, the right level of insurance can cover the cost of materials, tools, and labour, thereby ensuring the proper continuation of work right back from the stage where the damage occurred.
Some examples of contract work insurance claims:
- The roof of a building under construction is blown off due to winds and storms. In this case, the cost of replacing that roof will be covered by the insurance company.
- There is a fire in your house while building a house extension. The extension is completely or partially damaged in the fire. In this case, the repairing costs will be borne by the insurance company.
What is not covered?
It does not cover any constructions that are already existing on-site. As mentioned in the above example, if there is a building extension under construction and damaged due to a fire, the insurance will only cover the extension. The insurance company will only give the cost of repairing the extension. The rest of the building doesn’t get covered under this insurance.
Also, as mentioned earlier, this insurance will usually cover damage caused by risks like fire, flood, storm vandalism, or theft, but it won’t cover damage caused by terrorism, for example. You should check the policy documents for other exclusions.
Importance of buying Contract Works Insurance
It’s necessary to purchase the correct level of contract works insurance so that you stay covered in case you must make a claim. For this, you need to pick a cover level that is equal to the cost of your entire project, including materials and labor. This is applicable even if the duration of your project exceeds a year.
You can even make a tailor-made insurance policy to insure your construction business by adding covers like various liability insurances, machinery and tool covers, and contract works insurance altogether. To get yourself a reliable insurance policy, visit 2Bsure and get your quote in a matter of hours!