It is highly likely that at some point you will be asked to place this cover, usually found within the JCT forms of contract under clauses 21.2.1, 6.5.1 or 6.2.4. You may have even signed contracts were you should already have placed cover without realising it resulting in a potential breach of contract and a serious situation in the event of a claim. This cover is not normally included within public liability policies. It is sometimes also referred to as Party Wall Insurance.
The policy is designed to protect your client (the employer to the contract) against liability in respect of damage caused by collapse, subsidence, heave, vibration, weakening or removal of support or lowering of ground water arising out of or in the course of a contract.
It is particularly vital to have this cover in place when work involves underpinning, piling or any work on foundations, basements etc.
We are experts on this cover, as are our insurer partners, and we are therefore able to provide competitive quotations immediately or within a very short time scale.
Why call us ?
A contractor was undertaking demolition and refurbishment work involving 3 large properties, 2 of which were to be demolished and rebuilt, with the third being refurbished including underpinning.
A JCT 6.5.1/21.2.1 Non Negligence policy was taken out by the contractor in the joint names of contractor and employer in accordance with their contractual obligations.
In the property being refurbished, plaster was removed from a section of brickwork and shortly afterwards a chimney section of brickwork actually fell out. Cracks then started to develop and after a few weeks damage was at such a level that a Dangerous Structure notice was served resulting in a requirement for demolition of the entire building.
Expert engineers were of the opinion that collapse was inevitable, although this could not have been reasonably foreseen by the contractors and therefore full indemnity was provided under the JCT 6.5.1/21.2.1 Non Negligence policy in force. In this particular example the claim was settled at a total cost of £993,903. Had cover not been in place this would have had far reaching financial consequences to both contractor and employer to the contract.
Often under building contracts, clauses are present whereby the owners of the property will need to insurer the building whilst work is being undertaken and most home buildings and contents policies will exclude cover while work is being done. We have specialist markets to insure property undergoing renovation and usually unoccupied for specified perils and also include public liablity insurance for liability as owners of the property.
Failure to insure on the correct basis could have serious financial consequences in the event of a claim.
It is a requirement for many refurbishment or extension contracts that the employer or property owner arranges insurance for the works being undertaken (and for the existing structures outlined above) in joint names. This is also beneficial as the employer can ensure that cover is placed on the correct basis and has full control of the policy cover to ensure their assets are properly protected during the building operations. If an employer entrusts the insurance on the contractor, in the event of the contractor leaving site, or ceasing to trade, the works would be uninsured wereas if cover is arranged by the employer they would retain full cover and control over the policy.
We can arrange policies for specific one off projects in joint names of employer and contractor and also deal with the existing structures if required as well.
There is a considerable amount of work going on all around the country but especially in the London area involving the construction of basements to existing houses. This can be extremely hazardous and serious attention to the insurance in place must be considered for both the contractor doing the work as well as the owners and also neighbouring properties.
We are highly experienced in placing the policies required to provide protection for such projects for either the basement contractors themselves, or the property owners. These policies include many of the ones detailed above such as JCT Non Negligence, insurance for the existing structures and also contract works in joint names of contractor and employer.
Underwritten by leading European Insurers, we are able to offer 10 or 12 year buildings warranties for residential, commercial or mixed property developments, housing association, PFI and LIFT projects.
The policy is approved by most mortgage lenders and once the development has been technically signed off, there is no recourse against the builder. We do not require builder registration, bonds, indemnities or surety bonds and the insurance is priced according to the choice of cover and not the builders record or history.
Cover starts from the date of the first legal completion or in Scotland the date of entry on the premises and meets the cost of 'putting right' the premises in the event of a defect occurring in the structural parts. A defect is one that may damage or destroy the property whilst it is insured, and has to manifest during the period of insurance. Structural parts includes those which are essential for structural stability and waterproofing including walls foundations, windows, roof etc.
The requirement for a Performance bond is common place in most commercial contracts particularly construction.
Obtaining Performance Bonds and Guarantees from traditional sources such as banks is sometimes difficult, time consuming and frequently ties up working capital.
We understand these problems which makes the issuing of Surety Bonds and Guarantees as simple as possible without the need to tie up valuable cash resources.