3 Most Important Insurance Covers for Construction Contractors
Over the past 20 years, civil contractors have been exposed to changes in project delivery systems. The many risks involved in a construction project, coupled with the fact that these perils are often assumed, have forced contracting executives to look at civil contracting insurance carefully. Most importantly, a contracting manager in the construction industry must ensure that all projects are adequately covered. The best place to start from as you plan to take a contracting insurance for your projects is to understand the most critical covers in the construction industry.
Professional Indemnity Insurance -- If you are a design contractor, then every design aspect of a project falls under your docket. Therefore, if a liability arises because of professional negligence with the design of a building, then the professional indemnity insurance cover can protect you against such liability. For instance, if your models do not meet the standards set under the construction contract, then this type of insurance will keep you safe. The reason that professional indemnity insurance is one of the most important policies out there is that design is an integral part of a construction project. Another point to note is that the insurance coverage is expected to remain active until its limitation period lapses; in Australia, this period is ten years.
Contractor's Pollution Coverage -- The contracting insurance cover is most useful for projects that involve paving, demolition, grading, and infrastructure. Operations or projects that are addressed under this cover expose third parties to bodily harm because of pollution. However, the contractor's pollution protection is not limited to injury because pollution can cause damage to property within your operations area. Therefore, to avoid liability from pollution cases, it is best to anticipate such occurrences and take up a contractor's pollution insurance policy.
Delay in Start Up Insurance -- As much as you try to finish your projects in time, there is always a chance that you will experience schedule overruns. In any construction project, there will always be external or uncontrollable factors that might cause project delays. When this happens, commissioning of customer projects could be delayed thereby leading to business losses. For any delay, a contractor is required to pay a particular fee to the client as compensation for damages occasioned by such lapses. As such, it is important for you to be well prepared for such an eventuality, and the delay in startup insurance cover provides such protection.