Avoiding Common Pitfalls with Builder’s Insurance

Understanding What Builder’s Insurance Covers

What does builder’s insurance cover? Builder’s insurance typically includes public liability, employer’s liability, and cover for the builder’s own equipment. While these are important, they are not designed to protect the property owner. For example, if damage occurs to your partially built home due to an accident or extreme weather, the builder’s policy may not compensate you. In many cases, the cover only applies to incidents directly affecting the builder’s business or liability, not the homeowner’s financial loss.

It is also important to understand that if your builder fails to maintain their insurance or allows it to lapse, you may be left completely unprotected without even realising it. This can lead to disputes and potential financial strain if something goes wrong on site.

The Challenge of Proving Fault

Even if your builder does hold valid insurance, making a successful claim is rarely straightforward. In most cases, you will need to prove that the builder was directly at fault for any damage or loss that occurs. This means demonstrating negligence, error, or breach of contract on their part. For instance, if poor workmanship leads to structural damage or water ingress, it will be your responsibility to provide evidence that the builder’s actions caused the issue.

Without clear proof of fault, insurers are unlikely to pay out under the builder’s policy, leaving you to bear the costs of repairs or delays. This can be particularly difficult if multiple contractors or subcontractors are involved, as determining liability may require legal action or expert assessment. Having your own self build insurance ensures that you do not have to rely on proving someone else’s mistake before receiving financial support.

The Risks of Relying Solely on Builder’s Insurance

One of the biggest risks of depending solely on your builder’s insurance is lack of ownership over the policy. Because the builder is the policyholder, you have no direct control over its validity, coverage limits, or exclusions. If the builder’s policy is cancelled, expired, or inadequate, your project could be exposed to serious financial loss.

Additionally, builder’s insurance does not cover materials you supply yourself or property that becomes your responsibility during construction. For instance, if you have purchased high-value materials that are stolen or damaged before installation, you may not be able to claim for their replacement under the builder’s insurance.

Another frequent pitfall is the assumption that the builder’s policy automatically extends to any subcontractors working on site. In reality, subcontractors often carry their own insurance, and gaps between policies can leave your project partially uninsured. Without clear oversight, this lack of continuity in coverage can become a major issue.

Taking Control with Self Build Insurance

The most effective way to avoid these pitfalls is to take out your own self build or site insurance policy. Unlike builder’s insurance, self build insurance places the homeowner at the centre of protection. It covers the building work, materials, tools, and liabilities associated with your project, ensuring you remain fully protected regardless of who is carrying out the work.

Self build insurance provides cover for theft, vandalism, fire, storm damage, and accidental incidents throughout construction. It also includes public and employers’ liability where applicable, giving you complete confidence that your investment is secure. This means that even if your builder’s insurance lapses or a subcontractor fails to maintain their cover, your project remains fully protected.

It is also crucial to have a clear, written contract in place with your builder that outlines roles, responsibilities, and agreed costs. A well-drafted contract can prevent disputes, clarify who is responsible for what, and help you avoid unexpected expenses or gaps in liability. Combined with self build insurance, this creates a strong layer of protection that supports you legally and financially throughout the project.

Communicating Clearly with Your Builder

Open communication with your builder is vital. Always request written proof of their insurance, including details of policy limits, coverage dates, and exclusions. Check that their insurance is current and suitable for the scale of your project. It is also wise to ensure that any subcontractors involved carry their own valid cover.

By combining your own self build insurance with your builder’s policies, you create a comprehensive safety net that leaves no gaps in protection. This partnership approach helps prevent misunderstandings and ensures everyone involved is properly covered.

While builder’s insurance is essential for contractors, it is not designed to protect self builders in full. Relying on it alone can lead to uncovered losses and unnecessary stress. Investing in your own self build insurance and maintaining clear agreements with your builder is the most reliable way to safeguard your home, materials, and finances from start to finish. It gives you full control, peace of mind, and the assurance that your project is protected no matter what happens.