- Why a fully comprehensive insurance for construction?
- What does this insurance cover?
- What documentation is necessary for taking out this insurance?
- What type of construction work can be insured?
- Can I insure the machinery used on the build?
- Who can be the insured party or policyholder?
- How long does the insurance last?
- If the work has not been completed within the scheduled timescales, is the insurance still valid?
Why a fully comprehensive insurance for construction?
All construction works are subject to numerous risks. Some can be prevented, but others are unforeseeable (reduced times, site locations, the hiring of inexperienced staff, new materials and projects).
Large companies may contemplate a self-insurance system, but they can suffer damages that exceed their economic capacity, so it is necessary to transfer the risks to an insurance company.
The size of the project is immaterial, as both large- and small-scale projects can be hit by a major claim.
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What does this insurance cover?
Basic coverage:
- Conventional risks: fire, explosion, lightning strike, theft and pillaging, demolition, clearance of debris, breakage of windows.
- Natural risks: wind, rain, hail, snow, frosts, cyclone, hurricane, rivers flooding, subsidence and landslides, mudslides, earthquakes, volcanoes.
- Execution of the works: design errors, defects in the materials used, improper execution.
- Human causes: inexperience, negligence, malicious acts of insured personnel or third parties.
Optional coverage:
- Machinery and/or construction equipment.
- Testing and/or assembly of machinery.
- Additional costs, such as overtime, transportation and/or air freight.
- Pre-stockage of goods.
- Damage to pre-existing property.
- Personal effects.
- Maintenance.
- Civil liability.
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What documentation is necessary for taking out this insurance?
The required information for taking out fully comprehensive construction insurance is:
- Type of building.
- Number of stories and/or basements.
- Characteristics of the site and depth of excavation.
- Foundation system.
- Duration of the works.
- Location of the risk.
- Height and width.
- Insurance value.
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What type of construction work can be insured?
- Detached/terraced houses.
- Apartment blocks.
- Mixed office buildings.
- Public, social and commercial buildings.
- Industrial buildings.
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Can I insure the machinery used on the build?
Yes, you can insure the machinery to be used on the build, such as construction equipment, scaffolding, cement mixers, etc.
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Who can be the insured party or policyholder?
The natural insured party or policyholder would be the contractor, although any party involved in the build could also be (developer, constructor, bank, etc.).
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How long does the insurance last?
From the start date to the end date shown in the special conditions of the policy. These dates should be the start and finish of the construction work.
There is optional coverage for maintenance work and the repair of defects that have subsequently appeared. This option covers the same guarantees as in the policy for a further 12 months following expiry of the policy.
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Upon expiry the policy is cancelled. However, there is an option to change the date by amending the initial policy. If the cause is justified, then the amount of the amendment will not exceed what would have been paid when the policy was first taken out to any great extent.
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