Do Constructors need Contractor’s All Risks Insurance?


There are few busier workplaces than a building site and although that might be a good sign of the health of a building company, it can also increase the prospect of an accident happening, someone suffering an injury and damage to property.

To muddy the waters even further, it becomes impossible to know who the liability falls to if someone else’s mistake ruins your hard work, or even if an act of God causes the destruction of your work-in-progress. Either issue will result in you having to put more money and more work into it in order to set things right, as the client isn’t going to pay twice when they’ve already paid up the first time.

In this scenario, contractor’s all risks insurance (CAR) is a useful form of cover. It is designed to provide cover for damage to temporary structures, hired-in plant and tools and equipment on site, among many other things.

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CAR differs from other forms of cover because it’s designed specifically to be used on construction sites. It protects you from both the shoddy work of other contractors, as well as vandalism and natural occurrences, such as fire, floods or earthquakes.

Obviously, with natural occurrences such as fire and flood, your insurer wouldn’t be able to claim these back. However, against another contractor’s mistake, your insurer would pay for the repairs that needed doing, and then chase the affected contractor’s insurance company to reclaim the funds. And even if they weren’t insured, you’d still maintain cover.

Therefore, the real benefit of all risks insurance is that it protects you no matter whether the other contractors on site have insurance or not.

What does contractor’s all risks insurance cover?

The short answer is anything that hasn’t been specifically excluded from the policy. Most all risks policies will cover for accidental damage caused flood, wind, fire or earthquakes, as well as intentional damage caused by vandalism or theft. It protects both the temporary structure and all tools, machinery and plant on the premises as well.

Do I need contractor’s all risks insurance?

As a constructor can play a huge role in any building or renovation project, then it may be advisable to look into taking out contractor’s all risks insurance. It will not only protect you for damage against your operations, but the fact that you have the cover in place will show other parties that you are professional and are leaving nothing to chance.

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*This indicative price is for £1m public and products liability, £250,000 legal expenses, £10,000 financial loss and £10,000 accidental death insurance cover for a sole trader. The price includes insurance premium tax and our admin charge. 22% of new customers paid less than £59 between 1st January 2019 and 31st August 2019. The actual price you pay will depend upon your specific business requirements and will be affected by your trade, your claims history and the optional covers you select which are all priced separately during the quote process. This website is intended for customers based in the UK and is therefore subject to the UK regulatory regime(s) © Copyright 2021 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 this on the Financial Services register
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