What is contractors all risk insurance?
If you work in the construction industry, insurance is essential. However, knowing what insurance you need and why isn’t always easy to understand. This FAQ examines one type of insurance you may consider: contractors all risk insurance.
Contractors all risk insurance
Contractors all risk insurance is designed to make sure you are protected against all the common risks you may encounter when working in construction.
What does contractors all risk insurance cover?
Policies can differ slightly depending on the insurer. As a starting point, it should cover work in progress on site. You will normally find that it comes with:
- contract works insurance
- insurance for your tools, plant, and machinery
- cover for other potential risks, e.g. business interruption.
What is public liability insurance?
Public liability insurance protects you against third-party claims for injury or damage. Large businesses will normally insist you have public liability before they will work with you.
What is employers’ liability insurance?
Employers’ liability insurance safeguards against claims from employees or former employees for injury or illness as a result of working for you.
It is a legal requirement to have employers’ liability if you employ anyone, including trainees and some sub-contractors.
What is contract works insurance?
Contract works insurance protects the site or project you are working on from damage incurred before completion. For example, if a fire occurred on site midway through a job, your insurance would allow you to fix the damage and not end up out of pocket.
What does insurance of tools, plant, and machinery cover?
This covers you if your equipment is damaged or stolen. It allows you to replace the affected items and get back to work quickly.
What else is included in contractors all risk insurance?
This will depend on the individual policy. It’s always important to check with the insurer.
It’s common for contractors all risk insurance to include additional cover, such as business interruption insurance to safeguard against being unable to access the site to work for some reason, e.g. in the aftermath of an explosion or devastating storm.
Do I need contractors all risk insurance?
It is always important to have full insurance cover. If something were to go wrong and you were taken to court, your insurance will pay any damages, compensation, and legal fees.
If you don’t have insurance and can’t pay, your business, assets and reputation may be at risk.
Having insurance not only reassures clients that you are properly set up; it gives you the peace of mind that if anything goes wrong, you will be covered.