Construction Questions & Answers

With more than 135 experts in London, JLT Construction is the UK’s largest team of construction broking specialists. Their integrated team of over 400 experts globally work together to identify the most appropriate market and entry point for all major placements, actively sharing market knowledge to drive best practice and deliver coverage enhancements globally.

The team answer a series of frequently asked questions. Contact us if you would like to discuss any of these questions and answers in more detail.

WHAT HAPPENS IF...

Yes, if you purchase delay in start-up (DSU) cover as an extension to the contract works insurance for the project. You will need to arrange this insurance yourself, generally as part of an owner controlled insurance programme, rather than requiring the contractor to do this.

We recommend starting a dialogue with a broker once you have received planning approval. It is important to establish a suitable project insurance strategy before engaging with potential contractors so that any cost benefits can be fully realised from your supply chain.

Standard TPL insurance protects for common law liabilities only. Where these agreements extend liability beyond common law obligations, contractual liability insurance coverage is required. This can be provided under annual insurance programmes but these must be very carefully drafted by a specialist insurance broker. Alternatively, project specific contractual liability coverage can be tailored to transfer this risk, it is also available through specialist construction brokers.

Basic PI policies only cover professional negligence and this would need to be demonstrated to claim successfully. Some onerous wordings exclude liabilities arising under FFP obligations and this can also exclude losses even where there has been a negligent act. A high quality PI wording will cover civil liabilities and this will include FFP obligations, subject to some conditions and qualifications. A specialist construction insurance broker will be able to guide you through the coverage options available.

This is a complex area with a variety of coverage levels available. As a rule of thumb, CAR policies cover damage only, and the broader policies will include the cost of damage which is caused by a defect in workmanship, design or materials. Some narrower policies will deal with damage but exclude items that are defective. There will be no cover for something that is defective but not damaged. A specialist construction insurance broker will be able to guide you through the coverage options available.

Your insurance broker should have a strong network in place with offices in the regions/countries that you operate in. As such, they should be fully aware of local legislation and requirements, and be able to fulfil your global insurance needs.

As the defects rectification period has passed there will be no cover under the Construction All Risks (CAR) policy for this project. Your Third Party Liability (TPL) policy should respond in relation to legal liability for the loss of contents. Cover for the damage to the building itself (along with consequential loss) will depend on whether your TPL policy has been drafted to include liabilities arising from completed contract works and contractual liability. This is a very complex area of TPL coverage and one which is critical in delivering value to the policyholder. A specialist construction insurance broker will be able to guide you through the coverage options available.

Standard TPL insurance protects for common law liabilities only. Where these agreements extend liability beyond common law obligations, additional specialist insurance coverage is required. These policies, known as contractual liability or rail liability policies are available through specialist construction insurance brokers.

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