If you are looking to start building work on property, then before you so much as look at buying a hefty sledgehammer, you should get the right insurance to cover yourself and your property should any disasters arise.
Whether you are looking to do a bit of cosmetic work to your home or calling in the bulldozers and doing some major restructuring, you must first notify your buildings insurer. If you fail to notify them, you could risk invalidating your whole insurance policy.
If you are building your home from scratch, you must also cover yourself by taking out an all-risk full liability insurance. You will only be able to receive a loan to build your property if you take out this insurance.
If you have bought land to build on or are renovating a property, you must get contracts all risk cover to protect yourself adequately. If you are employing someone else to do the building work for you, make sure they have their own insurance. If the firm does not have insurance, do not employ them.
When considering the right insurance for your project, you must consider a policy that covers the building, any tools or machinery you are using, as well as your liabilities. The amount of cover you will need is dependant on the scale of the build and its value.
FLEA is exactly the type of insurance you should consider if you are considering refurbishing an exiting property. It covers you against Fire, Lightening, Explosion and Aircraft, and is available from most insurance firms. This covers the shell of your property during the build. Once this has been arranged, you need to consider what else needs to be covered.
It may be best to go through a broker for your insurance. They may be able to help you find deals that are not available to contactors directly. You will also have the benefit of having someone to help you if you need to make a claim.
There are two areas that you must ensure you are covered for, and this is your Employers Liability and your Public Liability. Ensure any subcontractors you use have their own full public liability insurance. If they do not, you may invalidate any insurance cover you have.
Your employers liability is there to cover any injuries to employees and contractors on the site. As a rough guide, aim to be covered to the value of £10 million, or somewhere around that figure.
Public liability insurance covers injury to anyone who is not an employee. This includes trespassers. It also covers damage to third party property, damage to underground property (such as water pipes) and damage to neighbouring properties. Again, aim to get cover worth at least £5 million. You are required by law to cover yourself for a minimum of £1million, but it is definitely worth getting a higher level of cover.
Ensure your cover extends to your materials, as well as any hired or owned machinery on site. It should also cover any temporary or permanent building works, site huts or porta-cabins. Cover that includes any legal expenses is a good idea too, to cover the cost of any potential contractual problems along the way.
It may not be something you want to consider when you are full of the enthusiasm of starting a new project, but it pays to consider the worst possible eventualities and ensure you are covered adequately if disaster strikes.
You may wish to consider seeking insurance that also covers you for personal injury in case of disability or even death.
You may also consider taking out a separate insurance to protect your income, in case you are unable to work. These policies could pay out around 50% to 65% of your income, and allow you to still claim state benefits. These payments are also tax-free. Self-employed applicants will generally be considered on a case-by-case basis and your previous 12-months earnings will be taken into consideration.
It is vital before agreeing to any insurance policy that you carefully read the terms and conditions under which your insurer will make payment.