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Contractors Liability & Sabotage by Disgruntled Employees | CivilSure

Does the Contractors Liability on the Contractors All Risk Policy cover damages to a structure that has been caused by a disgruntled employee’s premeditated intention to sabotage the structure?

No, this would be deemed “Defective Workmanship” which is an exclusion for Contractors Liability on the Contractors All Risk Policy, however the consequential loss and damage that would result in the above mentioned scenario would be covered through the Contracts All Risk Policy (Contractors Liability). In other words, the loss or damage the falling or broken structure has caused to any third party would be covered but not the cost to rebuild this structure.


Should this have been as a result of Civil Commotion or a Riot this would have been covered by SASRIA.

The Defective Workmanship can be accommodated by a product known as the “Design and Construct Professional Indemnity”,

however; it would be difficult to prove the above scenario was due to the disgruntled employee’s pre-meditated intentions to sabotage and the cost that would be incurred trying to prove this would most likely outweigh the cost to replace the structure from your own expenses. It might also fall on you, as you would have to have certain protocol in place to ensure that the employees are managed and should there be any disgruntled employees, the risk of them sabotaging anything should be addressed beforehand by preventative steps.

To read more about Design and Construct Professional Indemnity Insurance, click here.


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What is the Defects Liability Period?

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.

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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.

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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.

Does a Construction All Risk Policy cover damage to surrounding property?

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.

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When a Disgruntled Employee Sabotages Your Structure…

Does Contractors Liability on the Contractors All Risk policy cover damages to a structure, caused by a disgruntled employee’s pre-meditated sabotage?

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