What Does Builders Insurance Cover?
Caeva O'Callaghan | December 13th, 2022
If you’re a builder, you need a specialist kind of insurance. This type of policy covers you for the specific risks you’ll face in your day to day work.
Not only will good builders insurance cover you and your materials, but also liability should things go wrong.
In this article, we’ll cover questions such as:
- I’m a builder, what insurance do I need?
- Am I covered for public liability as a builder?
- Does my insurance cover me if materials used are faulty?
Building is a high-risk profession where working with the public comes as standard. This is why you need comprehensive builders insurance cover to protect you against all scenarios.
What is builder’s insurance?
Builders, contractors and tradesmen all need to have specialist insurance for their business. This will allow them to work in others’ homes and properties safely, and will cover the costs of repairs if unintentional damage is done. This applies not only to their clients’ property, but anything else they happen to damage as well.
Accidents like these are the number one reason builders need insurance. Without it, you may find it difficult to find clients willing to take a risk on an uninsured tradesman. And, if things go wrong, you could find yourself disastrously out of pocket.
Any builder, plumber, electrician, general tradesman or painter worth their salt needs to purchase insurance before they take on work. You will need three types of liabilities included in your insurance policy. These are:
- Public Liability
- Products Liability
- Employers Liability
The importance of having the right cover is vital for all tradesmen as work can be very high risk. They need to be able to protect themselves, their employees, their customers and their property, equipment and materials.
What does builders insurance cover?
Public Liability is one of the most important parts of builders’ insurance. It protects the customers of the tradesmen or any member of the public in the event that a claim should arise and the tradesmen are responsible.
Basically, this is exactly what you’ll need to claim against if you accidentally damage your client’s property while working on the site. Their public liability insurance will cover the cost of the labour and materials involved in replacement.
Meanwhile, Products Liability covers you in the event of a claim relating to parts and materials you install. Bought a faulty pack of vinyl flooring? This is the policy you need if the tiles are wonky or arrive damaged, and the job is delayed.
In the majority of cases, the insurance provider you have your policy with will pursue the manufacturers. As long as the part turns out to be defective, it wasn’t your own fault and you installed the materials correctly, the manufacturer will be liable.
Other cover you may need
While purchasing builders’ insurance, you may be offered additional cover. Professional Indemnity insurance is to cover your legal liability for the advice and design that you provide.
A Public Liability policy will not cover financial loss or damage to the contract works (either before or after completion). Public Liability is there to cover your actions (i.e., what you do) whereas a Professional Indemnity Policy covers your advice (i.e., what you say). This kind of cover is not expensive, but it is a good idea to have.
All Risks is another type of policy which is good to have. As suggested by the name, it covers almost everything else you can imagine. All Risks insurance includes cover for contract works such as damage to the project being worked on, own plant, hired-in plant and employee’s tools.
This kind of insurance can be once-off or an annual policy depending on your requirements or those of your client. It can include cover for public and employers liability also.
You should buy builders’ insurance if you’re a building or groundworks contractor, or in an associated trade of any size, including plumbers, carpenters, tilers, painters and decorators, brick layers, heating and plumbing engineers, plastering, insulation, roofing, fit-out, and flooring contractors.
If you need builders’ insurance and want to get the best value, you need a broker who knows the market, knows the product and has access to the most competitive terms available. Call our builders insurance experts today and they can assist you with your specific requirements .
All Information in this post is accurate as of the date of publishing.