Get a quote
Home Contractor's Insurance Contractors All Risk Insurance What is Contractors All Risk Insurance and Who Needs It?

What is Contractors All Risk Insurance and Who Needs It?

If you’re working as a contractor, it’s more important than ever that you have the right kind of insurance in-place. A contractor’s all risk policy can protect you against serious legal claims, including personal injury, public liability and property damage.

Contractors All Risk (CAR) insurance is essentially a comprehensive policy designed to protect your business from a wide range of perils. Here at Tradesman Saver, we specialise in providing contractors and construction insurance to individuals and businesses of all sizes.

What is Contractors All Risk Insurance?

Contractors All Risk insurance is a non-standard insurance policy that provides coverage for contract work, including materials, equipment, and temporary structures. It is designed to cover any loss or damage that occurs during the course of a construction project, regardless of who is at fault.

CAR insurance typically includes cover for:

  • Contract works (materials and labour)
  • Plant and equipment
  • Temporary buildings and structures
  • Third-party injury or damage
  • Professional fees (e.g., architects, surveyors)

The policy is usually taken out by the main contractor, but can be extended to cover the interest of subcontractors and other parties involved in the project.

How is CAR Insurance Different from Other Types of Insurance?

CAR insurance is a specialised type of insurance policy that is tailored to the unique risks faced by contractors. It differs from other types of insurance in several key ways:

  • Comprehensive Coverage: CAR insurance provides broad coverage for a wide range of risks, including damage to the works, third-party injury or damage, and professional fees. This is in contrast to more limited policies like public liability insurance, which only covers third-party injury or damage.
  • Project-Specific: CAR insurance is typically taken out for a specific construction project, rather than being an ongoing policy like general liability insurance or car insurance.
  • Flexible: CAR policies can be customised to meet the specific needs of each project, with options to extend coverage to additional parties or risks as needed.

Who Needs Contractors All Risk Insurance?

CAR insurance is essential for any contractor involved in construction projects, regardless of their size or scope. This includes:

  • Main contractors
  • Subcontractors
  • Tradespeople (e.g., electricians, plumbers, carpenters)
  • Developers
  • Property owners

Essentially, anyone with a financial interest in the project should consider taking out CAR insurance to protect their investment.

Is CAR Insurance Required by Law?

While CAR insurance is not legally required in the UK, it is often a contractual requirement for construction projects. Many clients and main contractors will insist that subcontractors have their own CAR policy in place before allowing them to work on site.

Even if it’s not a contractual requirement, CAR insurance is still highly recommended for any contractor. The financial consequences of an unexpected loss or damage can be devastating for a small business, and CAR insurance provides peace of mind that you’re protected.

Premiums you won't find on a comparison site

Starting at £54* per year

What Does Contractors All Risk Insurance Cover?

CAR insurance is designed to provide comprehensive coverage for a wide range of risks associated with construction projects. The specific coverage will vary depending on the insurer and the policy, but typically includes:

Contract Works

This covers the cost of repairing or redoing any work that is damaged or destroyed during the course of the project. It includes materials, labour, and any temporary works (e.g., scaffolding, hoardings).

Plant and Equipment

This covers any loss or damage to plant and equipment used on the project, including hired-in plant. It can also be extended to cover employees’ tools and personal effects.

Temporary Buildings and Structures

This covers any temporary buildings or structures used on the project, such as site huts, storage containers, and portacabins.

Third-Party Injury or Damage

This covers any injury or damage caused to third parties (e.g., members of the public, other contractors) as a result of the project. It includes both property damage and bodily injury.

Professional Fees

This covers the cost of professional fees incurred as a result of a loss, such as architects’ or surveyors’ fees for redesigning or assessing damage.

Other Optional Covers

Depending on the insurer and the specific needs of the project, CAR policies can also be extended to cover additional risks such as:

  • Delay in start-up (covers financial losses if the project is delayed)
  • Offsite storage (covers materials stored off site)
  • Debris removal (covers the cost of removing debris following a loss)
  • Pollution liability (covers clean-up costs and damages caused by pollution)

What is Not Covered by Contractors All Risk Insurance?

While CAR insurance provides broad coverage, there are some exclusions and limitations to be aware of. These will vary depending on the insurer and the specific policy, but common exclusions include:

  • Defective workmanship or design (unless covered by a DE4 extension)
  • Wear and tear or gradual deterioration
  • Consequential losses (e.g., loss of profits, liquidated damages)
  • War, terrorism, or nuclear risks
  • Pre-existing property (unless specifically included)

It’s important to carefully review the policy wording and discuss any exclusions or limitations with your insurance broker to ensure you have the coverage you need.

How Much Does Contractors All Risk Insurance Cost?

The cost of CAR insurance will depend on a range of factors, including:

  • The size and scope of the project
  • The type of work being undertaken
  • The location of the project
  • The experience and claims history of the contractor
  • The level of cover required

As a rough guide, CAR insurance typically costs between 0.5% and 1.5% of the total contract value. So for a £500,000 project, the premium could range from £2,500 to £7,500.

However, it’s important to remember that the cost of not having CAR insurance could be far higher. A single claim for property damage or third-party injury could easily run into the tens or even hundreds of thousands of pounds, which could be devastating for a small business.

Choosing the Right Contractors All Risk Insurance Policy

When choosing a CAR insurance policy, it’s important to work with an experienced insurance broker who understands the unique risks and challenges of the construction industry. They can help you assess your specific needs and tailor a policy to meet them.

Some key things to consider when choosing a policy include:

  • The level of cover required (e.g., contract works, plant and equipment, third-party liability)
  • Any additional covers needed (e.g., delay in start-up, offsite storage)
  • The excess (the amount you’ll need to pay towards any claim)
  • The reputation and financial stability of the insurer
  • The claims handling process and support provided

It’s also important to ensure that all relevant parties (e.g., subcontractors, suppliers) are named on the policy and that their interests are adequately protected.

Get Covered with Tradesman Saver’s All Risks Insurance for Contractors

Contract works insurance is essential for any contractor involved in construction projects. It provides comprehensive coverage for a wide range of risks, from damage to the works themselves to third-party injury or damage.

While the cost of CAR insurance may seem like an additional expense, it pales in comparison to the potential financial losses that could arise from an unexpected event. By investing in a tailored CAR policy, contractors can protect their business, their reputation, and their livelihood.

At Tradesman Saver, we specialise in providing tailored insurance solutions for contractors and tradespeople. Our CAR policies are designed to meet the unique needs of your business, with options to cover everything from contract works to plant and equipment.

We also offer a range of other essential covers for contractors, including:

  • Public Liability Insurance (from less than £54* per year)
  • Employers’ Liability Insurance
  • Professional Indemnity Insurance
  • Tools & Equipment Insurance

With Tradesman Saver, you can get the protection you need at a price you can afford. We work with leading insurers to bring you the best possible cover at the most competitive rates.

So if you’re looking for comprehensive Contractors All Risk insurance, or any other type of insurance for your contracting business, get in touch with Tradesman Saver today. Our expert team is on hand to help you find the right policy for your needs.

Get Your Contractors All Risk Insurance Quote Today

At Tradesman Saver, we make it easy to get the Contractors All Risk insurance you need. Simply fill out our online quote form or give us a call, and we’ll provide you with a tailored quote in minutes.

We understand that every contracting business is different, which is why we offer a range of options to suit your specific needs and budget. Whether you’re a sole trader or a large contracting firm, we can help you find the right cover at the right price.

So don’t leave your business exposed – get your Contractors All Risk insurance quote from Tradesman Saver today. With our comprehensive cover and competitive rates, you can have peace of mind knowing that your business is protected.

This website is intended for customers based in the UK and is therefore subject to the UK regulatory regime(s) © Copyright 2024 Tradesman Saver | Tradesman Saver and Henry Seymour & Co. are trading names of Barkdene Limited which is authorised and regulated by the Financial Conduct Authority (FRN 303965) for our insurance distribution and credit broking activities. Barkdene Limited is a credit broker not a lender. You can check our financial services registration status on the Financial Services register.
Registered in England No 1842617. Registered Office – Chancery House, St Nicholas Way, Sutton, Surrey, SM1 1JB. All rights reserved.
Back To Top
You need to be logged in to Your Account to make a payment. Redirecting you to Account Login.