For construction risks a bespoke insurance is by definition essential. Every project differs. Because of innovative constructs and new contract forms, standard coverage is never sufficient nowadays. This is on top of questions about who bears which risks and is responsible for covering them
To answer those questions and to determine which sections will need to be insured, thorough knowledge of the construction market coupled with expertise in the field of insurance and its technicalities.
The CAR-insurance consists of several sections. The coverage provided is different for each section. As a condition for coverage there must always be a correlation between the section and the work. The most important sections of the CAR-insurance are:
– Section I: The work. The work comprises the objects to be built, under construction and/or completed, and all materials intended for construction. This refers, amongst other things, to the materials intended to be permanently incorporated into the object and that are located on the building site.
– Section II: Liability. With a CAR-insurance you can cover the liability risk of construction work. This section covers personal and property damage to third parties. The liability coverage from the CAR-insurance complements your company liability insurance as the CAR-insurance provides coverage for specific risks excluded on the company liability insurance.
– Section III: Property of the principal. This section covers damage to existing property that are caused by activities covered with the CAR-insurance.
– Section IV: Property of management and personnel. This section provides coverage for all external calamities if the insured party is required to provide coverage by the specifications or otherwise.
– Section V: Tools, portacabins and sheds that are present on the building site for the work.
The limits for the aforementioned sections depend on the work to be insured, the additional coverage to be insured under the specifications, as well as additional coverage to be insured in view of the work.
Do you primarily want coverage for the liability section because you’re obligated by the specifications? Do you wish to insure the portacabins and/or sheds as standard? Property of management and personnel? All possible! Even management deliveries or ancillary contractors can be provided coverage if that’s your responsibility. Together with your advisor you’ll put together your CAR-insurance and agree upon ways to keep control of the risks attached to the work being done that requires further consultation with your advisor and the insurance company.