Why is Removal of Lateral Support Insurance required?
In terms of the law, there’s a duty placed on the Owner of land/property (or a Developer), to provide lateral support to adjacent land or property. Basically, an aggrieved party can bring an action against the Owner of a neighbouring property, when the latter removes or interferes with the lateral support of his land or building, causing damage or injury to arise.
It’s important to note that a person can ‘lawfully’ remove lateral support. However, the removal is converted into an ‘unlawful act’, as soon as it causes damage to the adjacent land and/or property. The Party responsible for this unlawful act would become ‘legally liable’ for any resultant injury to third parties, or damage to third party property.
The liability arising from the removal of lateral support is an absolute liability as regards the Developer or whoever has decided to excavate and hence the cover should be taken out by the Owner of the property or in agreement with the builder.
A common misunderstanding is that the liability section of a Contrators All Risks policy will provide cover in the event that a Contractor/Builder causes damage to an adjacent third party property, or injury to third parties, due to the removal of lateral support from such property.
But this is incorrect, as the policy specifically excludes liability in such circumstances.
What type of cover is needed?
This is a specialist type of cover and the Owner or Contractor would have to take out a Removal of Lateral Support extension to their underlying Contract Works policy – which would cost more and have a capped limit of indemnity.
It’s also important that the Engineer responsible for designing and implementing the Lateral Support system has adequate Professional Indemnity insurance in place because the Contract Works Lateral Support extension will not respond to a third party property loss claim if the damage is found to be caused by a defect in the design of the Lateral Support system.
Feel free to contact one of our expert consultants on 080 777 7771 for more info, or for a speedy, no-obligation quote.