Why is project insurance so important?
When you opt for an extension or serious renovation work to your home, it’s essential that your insurers are notified before the project starts. Any building work carried out on your property increases the risk of something unforeseen happening, so you might find your house insurance premium increases for the duration of the build.
At the same time, if you fail to notify them and something happens, they can refuse to pay out because of the change in circumstance.
If you find that your existing insurer won't cover renovation or extension work, then taking out an additional, specialist policy should be your next step, especially on a self-build project.
Can I rely on my builder's insurance?
You will be entering a contract with your appointed builder at the beginning of the project where you will establish that they have their own insurance in place, but their cover alone will not safeguard all of your interests, particularly on a large-scale project.
Most trades will have Public Liability insurance, but to claim on this you have to prove negligence on their part, which can be an expensive and lengthy process. Your builder’s protection will also only apply against their interests and not necessarily yours. For example, their insurance will not cover your liability for the plot before work commences.
Obtaining a specialist policy with contractors ‘all risk’ insurance is particularly important for those of you planning to manage your own projects. By hiring in trades to do work for you, you become their employer and therefore can be held liable for incidents on your site. Claims for death or serious injury can and do run into millions of pounds.
Having the right policy can be a lifesaver and there are many horror stories reported on. In the case of Tiffany and Jonny Wood (Grand Designs project, 2008) they found it was worth having site insurance for their project in Bath. Building on a hillside site, as they dug into the slope and installed the retaining piles, they uncovered an underground stream – and subsequently watched in horror as their neighbour’s garden started to slide down onto their plot. Thankfully, the couple’s site insurance paid up and the project was saved.
Site Insurance is necessary to protect your investment when you’re carrying out a renovation, conversion, extension, or new build. The policies cover the new work, existing structure and rest of the site. It protects against the likes of losses, fire, theft, flood, storm damage, vandalism and accidental damage.