The main part of the Contractors All Risks insurance is the Contract Works section which provides cover for the property being worked on (e.g. new house, etc.). But it’s important to be aware of what’s not covered by a contractors all risk policy, these are just a few examples:
Your onsite machinery (plant) is vulnerable to a number of problems such as breakdowns, vandalism and theft. Missing a project deadline can be bad news for your bottom line as well as your reputation. Plant All Risk Insurance covers you for loss of, or damage to, construction plant and equipment whilst in storage, transit, on the contract site or being use as a tool of trade.
Yes, damage to surrounding property is covered by a construction all risk policy, provided it’s included as an add-on to the Contract Works cover. This means an extra premium would be charged to get the specified surrounding property covered.
A Latent Defect is a defect that is not detected by ordinary inspection, but lies hidden until sometime later, when it’s discovered because it causes a problem that everyone can see. An example of latent defects would be weak concrete in part of a bridge column, that looks the same as strong concrete, but collapses when a heavy truck drives over the bridge.
A Contractor can claim for an extension of time, thus extending the Due Completion Date for a project. He can also claim for any costs which will increase due to being on site for longer (called time-related General Items).
The Defects Liability Period starts when the Certificate of Completion is issued and continues for the period agreed to in the Contract. During the Defects Liability Period, the Contractor has to obey all written instructions from the Engineer to carry out repairs and fix any defects which appear in the Permanent Works, so that, at the end of the Defects Liability Period, the Permanent Works are in the condition required by the Contract.
Practical Completion doesn’t mean the Contractor has finished the Works in every detail. It means the Works are sufficiently complete to be safely used by the Employer for the purpose he intended. The Contractor may still complete minor items and fix defects after Practical Completion, as long as the Employer isn’t inconvenienced.
When it comes to planning a new construction project, insurance doesn’t always get the priority it requires, with contractors often wondering whether it is really necessary to take out a contract works policy at all. Very often the contract works policy is arranged at the last minute, or even after the project has already started.
Have you read your plant hire contract? You should get evidence of the plant hire contract when you hire in a concrete pump truck or any other item of plant.
Does Contractors Liability on the Contractors All Risk policy cover damages to a structure, caused by a disgruntled employee’s pre-meditated sabotage?
Dirk Gouws (Engineering Insurance expet, AC&E Engineering Underwriting Managers) explains the meaning of having your name on a Contractors All Risk policy.
All construction work, no matter the size or complexity of the project, contains an element of risk. Find out why you need Contractors All Risk Insurance.
To determine the value of construction plant we investigate Market Value, Fair Market Value, Replacement Cost, Replacement Value & Actual Cash Value
A Contractors All Risk insurance policy, provides cover for the contract works, surrounding property, contractors’ public liability, SASRIA, Special Risks..
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