Our policy provides cover under one single, seamless policy for the existing structure, the contract works, the contents and the property owner's liability exposures for the period of any rebuilding, refurbishment or construction.
If you're interested in getting access to PropertyWorks, please email firstname.lastname@example.org to register your interest.
Regardless of whether a contract requires your client to insure, we believe that all property owners should be concerned about protecting their property and liability on a “First Party” basis. Your client's property is an important and valuable asset and it is therefore imperative that they maintain control over the insurance arrangements to best protect their interests.
PropertyWorks is backed by a team of specialist underwriters who have many years experience of contract works and property insurance. They understand the very real risks that your client' could be exposed to if they do not have adequate protection from their insurance cover.
Our cover is tailor-made to fit the specific requirements of your client and ensures that they are protected against the risks they either contractually agree to insure, or ought to be concerned about when insuring properly.
Our PropertyWorks product has been designed to give the type of cover you would expect from a standard commercial insurance policy but which also extends to include the contractual obligations of the property owner.
There are a few key exclusions you can expect:
Please note that this summary is not intended as a full list of our policy conditions and exclusions. For full terms, conditions, exclusions and limitations please refer to our policy summary and policy wording, available at the Document Centre.
Why PropertyWorks? When notifying their current property insurer of a significant renovation, particularly where insurance cover is prescribed by contract, property owners can frequently find themselves faced with numerous difficulties.
Property insurers are often unable to accept the risk of insuring what is effectively a building site with all the inherent risks they bring:
Depending on the circumstances, some insurers will look to stop covering the property and come off risk.
Alternatively, an insurer may provide some cover on the existing property but this is usually on a vastly reduced and highly restricted basis. This then puts the property owner at risk of being in breach of any contractual obligations that may apply to the contract.
This means the property owners is reliant on the contractor's insurance to provide adequate cover. Commercial insurers will not normally cover the contract works, preferring to leave that to the contractor. This means the property owner is reliant on the contractor's insurance to provide adequate cover.
This potentially leaves the opportunity for there to be both:
At the very least, your client loses control over a key aspect of cover that they need to rely on to protect their interests in the event of a claim.
Where the work being undertaken is of a more substantial nature, the property owner is likely to employ a professional team to oversee the project.
Architects in particular tend to work with “off the shelf” JCT (Joint Contracts Tribunal), as these provide a good template to deal with all aspects of the operation of the works and the relationship between the builder and the property owner.
Within the JCT contract, the property owner may be contractually obliged to insure in joint names with the contractor, both the existing structure and the works against loss or damage by specified perils.
By agreeing to insure in joint names the property owners existing insurer loses the right to pursue the contractor and recover any costs they may have to pay out in the event of a claim, even if they have been negligent.
Insurers can be extremely reluctant to maintain insurance which is in joint names and could seek to reduce their exposure by limiting the extent of cover. This means meaning the property owner might then be in breach of their contractual obligations as stated within the JCT contract.
This concerns the liability of the property owner in respect of others to compensate them for injury or damage to their property whilst the works are ongoing.
A property owner may think that if a builder he hires injures a visitor, that builders insurance will pay. This belief has some merit but a visitor will see the owner as the creator of the risk, even if someone is working on his behalf.
There are also other concerns that come with relying on another party’s insurance to provide adequate cover. For instance, the property owner should ensure that the contractors’ insurance is adequate, is still in force (has been renewed) and that they are not committing acts that are in breach of their policy conditions.
Another important aspect to consider is the extent of liability cover required under a JCT contract. The standard JCT wording states that the contractor is only liable for their own negligence and not the negligence of the property owner.
It is therefore very important to protect the owner from potential gaps in the cover from arising.
By this we mean the buildings of the property including out buildings, garages, walls etc. if cover is required.
Under this policy, cover is written on an indemnity basis. Not new for old. The cover provided will ensure that the existing property will be restored to the condition it was in prior to any loss (providing it has been insured for the correct value.
The breadth of cover provided will however vary dependant on the construction of the property and its condition. For example, if a property is used every day and is in a sound condition, we should be able to provide "All Risks"* cover. If the property is in a dilapidated state and unoccupied, then the perils operating would probably need to be restricted in some form.
If contract conditions require insurance for specifically named risks, then we can usually accommodate this to match in with contract obligations.
The policy also provides cover for the cost of renting alternative accommodation if incurred whilst the property is being repaired following an insured claim rendering it uninhabitable.
(*Under any "All Risks" policy, there will be certain exclusions that apply e.g. A standard "All Risks" buildings policy would exclude storm damage to gates and fences.)
This item covers the materials and fixtures and fittings used in the works carried out at the property against "All Risks"* of physical loss or damage.
The sum insured should be the full contract value inclusive of VAT.
We would usually cover, as standard, up to £5,000 value of loose contract materials on site at any one time, (subject to being satisfied with site security).
By this we mean standard contents within the property, which are the property owner's possessions or which they are legally liable for.
If cover is selected, the contents are insured against:
Our PropetyWorks policy gives an automatic cover of up to £2,000,000 in respect of your client's legal liability to others to compensate them for injury or damage to their property, arising out of their capacity as property owner during the period of insurance.
NB. Please note that there is no cover for contractors' or employers' liability.
Telephone advice for any private legal problem...
Within the UK the policy automatically provides a 24 hour advisory service for telephone advice on any private legal problem of concern to the property owner. Specialist lawyers are at hand to help or if they need a lawyer or accountant to act for them.
Whilst this section does not provide legal expenses cover, the helpline may be able to offer the property owner assistance under a private funding arrangement.
As an addition to the legal helpline service, the property owner will have access to a Legal Document Service.
This will provide them with:
For full terms, conditions, exclusions and limitations please refer to our policy summary and policy wording, available at the Document Centre.
We provide your client with a consistent basis of settlement because a single insurer underwrites the entire policy, under a single policy wording.
This means your client will avoid any potential “grey areas” in the event of claim and disputes that could arise with the client’s property insurer covering the existing structure and the contractor’s insurer covering the contract works. Each insurer would have their own policy wording and cover different perils, with different limits and exclusions. This could result in possible gaps or overlaps in the cover resulting in potential problems for your client when trying to resolve a claim.
In addition to that, each insurer is likely to appoint their own loss adjustor to work on their behalf, each trying to protect the position of their respective client.
Please note that claims are paid on an indemnity basis and not new for old.
Helping your client to safeguard their property and reduce their liability exposures.
During the course of works at their property, your client will be exposing this valuable and important asset to increased risk. Regardless of whether your client chooses to buy insurance to protect themselves (and of course, we strongly recommend that they do), it is still important that they consider ways of protecting their property and exposures resulting from injury or damage to a third party.
We have therefore compiled the following information which your client may find useful to remind them of the issues they need to evaluate when their property is undergoing works.
What is the risk? During works, the exposure to fire is greatly increased due to electrical work, welding work, use of paint removal torches etc. Should fire occur, it has the potential to cause severe damage to property (which could put the project back months) and endanger life.
Steps that can help prevent a fire at the property:
What is the risk? Always ensure that the property and its contents are adequately protected from intruders. However, during the course of works, with workmen perhaps going in and out of the premises, doors and windows may be left open and unattended. Scaffolding may make access to the upper parts of the building easier.
Steps that can help prevent a theft from the property:
By this we mean the exposure to wet weather or storm damage and the damage that can be caused by faulty water apparatus such as pipes or gutters.
Steps that can help prevent damage to the property from water:
The safety of your client, the contractors and the public is paramount. The very nature of certain works exposes everybody to an increased risk of injury.
If using a professional architect or contractor to manage a project the client should ensure that they are adequately qualified and that they have adopted Health and Safety procedures on site.
Whilst certain contract conditions between the client and the contractor may mean that they are responsible for insuring certain aspects of cover in joint names, (meaning that the client or their insurer cannot pursue a negligent contractor causing loss from a contract specified cause), there may be circumstances where the client or their insurer are able to pursue a recovery from a contractor.
Steps that can limit exposure to liability issues should they arise:
We are able to provide quotations for non negligence insurance.
(Please note that special conditions could apply to the PropertyWorks insurance we arrange for your client. In the event that cover is agreed, clients should refer to their policy schedule and wording for the specific details of the cover applicable to them).