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  • What insurance do you need for a self-build, renovation or conversion project?

    Self Build Insurance

    If you are taking on a self-build, renovation or conversion project, then you will find that most standard home insurance policies won’t cover you in the event of something going wrong.

    Many people carrying out self-build or renovation projects will believe that their builder or contractor will have insurance to cover the project, which isn’t necessarily always the case. Unfortunately, you can’t always rely on the builder to have the correct insurance in place which can then potentially leave one of your biggest assets un-insured during a period of high vulnerability.

    So, what insurance do you need to make sure you are covered?

    Check that your contractor has Public Liability Insurance

    Hopefully your contractor has public liability insurance, which basically covers the contractor or tradesman against their liability towards you for their negligence should anything go wrong.

    However, you need to be aware that this doesn’t cover you against essential circumstances such as if the property is damaged during an accident, fire, flood or storm, or if any items are stolen from the site.

    You will also find that this does not insure you against the possibility of causing injury to someone else or causing damage to a neighbour’s property during the construction project. As any building project carries with it danger and the huge potential for incidents to occur, insurance in these areas is essential.

    Where negligence cannot be proven, you may need to consider a JCT Contract and more importantly a JCT Insurance policy.

    Contractors All Risk Insurance covers the work in progress

    As there are so many risks of loss or damage involved in renovation projects it is essential that your builder has ‘Contractors All Risk Insurance’ in place. This is a specialist product otherwise known as either ‘Site Insurance’ or ‘Contract Works Insurance’.

    This will insure the property, tools, plant and machinery, or third parties, and protects the work in progress against damage or loss. It is important to make sure that the contractor had an insurance policy with a limit that meets or exceeds the total value for the full re-building cost of the project including labour, materials and tools.

    If your contractor is merely building the shell of the project and then handing over the project from there then you will need to extend the policy or write in a clause to highlight that they remain responsible until the project completion, otherwise you will have no cover once they have left the site.

    Structural Warranties cover you after the project is complete

    Once your renovation project is complete, a 10-year structural warranty is recommended on a self-build property. Any issues which you would normally claim on your home insurance for can be questioned and excluded by your insurer due to poor workmanship for which you would have no recourse. The warranty will also allow a prospective purchaser to obtain a mortgage on the property if you sell it on.

    A warranty provider will check and sign off on the site, the design and build of the project to ensure there is no defective workmanship. Ideally it is better to get an expert involved in this from the beginning of the project as costs can increase at a later stage.

    Advice on any claims

    As with any insurance policy it is important to thoroughly read the schedule documents and ensure your details are correct and you are covered appropriately. There may be some stipulations that you should also be aware of in terms of your obligations to ensure a valid claim.

    It is advisable to make any claim promptly and we would recommend that you take photos of any damage to help with your claim. It goes without saying that prevention is better than cure so keeping the site secure and plant, materials or tools out of sight is going to serve you better in the long run.

    For further information on Bluedrop’s Contractor’s All Risk Insurance, please visit this page.

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