Builders' Insurance

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Types of cover most used by UK builders

The types of insurance cover most used by UK builders are similar to those used by most other professionals and tradesmen. Although some of these insurance policies are common to all businesses, some are also specifically related just to builders. Some of the cover is legally required, while others are optional. However, it’s a good idea to carry all of these types of cover if you want to stay financially well-protected.

Legally required cover

Builders Employers’ liability is the only cover required by law, and then only if you employ someone else. This includes any staff, part-time staff, trainees, sub-contractors, or relatives. Employers’ liability pays the cost of a claim from an employee who has been injured while at work. It also pays the cost of a claim from an employee who has becomes seriously ill as the result of working for you.

Since there is a very high risk of injuries in the building trade, this law is actively enforced throughout the United Kingdom. So if you’re going to cut costs, don’t make your Employers Liability insurance premiums one of those cuts! You may be able to cut costs by hiring relatives, but you’ll still have to have adequate Employers Liability insurance for each person.

Highly recommended cover

There are some insurance policies that most of the professional builder associations recommend having, although they’re not compulsory. One of these is Public Liability insurance. Public Liability provides coverage for your legal responsibility for third party injuries. It also covers the property damages that you may accidentally cause during the course of the building work. Many people now insist that builders have Public Liability insurance before permitting them to undertake any work on their property. This is usually taken out in amounts of one, two, or five million pounds, and is usually fairly inexpensive.

Another highly recommended covers is Builders Products Liability insurance. This covers your legal responsibility for third party bodily injury or property damage caused by the products you sold or supplied. However, it should be noted that Public and Product liability insurance covers do not apply to employees.

Of course, you should also insure your equipment and tools against loss, damage, or destruction on or off site. Builders Tools, plant, and equipment insurance provides this type of cover. You should also make sure your business vehicles are all properly insured. Additionally, you should also acquire Income Loss protection.

Comprehensive packages

Some insurance companies offer builders comprehensive insurance packages that combine some of the aforementioned cover. One such type of combined covers package is commonly known as Site Insurance for Self Builders. It is for single dwelling self build projects and normally covers contract works, liabilities, personal accident, and legal expenses.

A variety of risks, such as flood, fire, storm damage, and theft are covered. It also usually includes cover for equipment and tools. The liabilities coverage usually includes Employers Liability and Public Liability. This specialised insurance should be taken out as soon as the plot of land is purchased and maintained until your building project is completely finished.

Another comprehensive insurance cover package especially designed for builders is called Site Insurance for Property Developers. This type combines most of the insurance cover plans needed by people developing property that will be sold or rented out upon completion. This includes new builds, renovations, conversions, and extensions. Property development insurance is used by property developers, individual home builders, construction companies, and contractors.

A standard property development cover usually includes coverage for permanent and temporary works. It also includes Employers Liability, Public Liability, personal accident and legal expenses. The standard policy also usually includes cover for temporary buildings, fixtures, and fittings. Constructional plant, tools, & equipment, and hired in plant covers are also normally included.

Other extensions

Other extensions may be added on, such as loss of rental income or loss of mortgage interest. JCT Insurance 21.2.1 Clauses may be added in to cover liability for damage to adjacent or surrounding property. Structural Warranty may be added on, as well as cover for missing or incomplete deeds. Although there are several more types, these are the insurance covers most used by UK builders.

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