Contract Works vs Public Liability Insurance

Knowing what’s covered under these two key insurance products could put you one step ahead...

Contract Works Insurance Contract Works Insurance provides cover for accidental and physical loss to the building during the Construction period.

Examples of Contract Works claims include (and not limited to): • Builder puts a nail through a water pipe causing an internal flood • The bench top gets dropped whilst being installed • Fire damage • Impact damage to the building • Storm damage rips off the roof during heavy winds • Appliances or hot water cylinders stolen from site • Malicious damage or vandalism

Contract Works Insurance will provide cover for the cost of repairing the work or replacing the lost items.

Contract Works Insurance should also include cover for sub-contractors in respect of materials that they have supplied and work that they are doing.

Public Liability Insurance Public Liability Insurance provides cover for accidental damage caused to someone else’s property.

Examples of Liability Claims may include (and not limited to): • Damage to underground services – accidentally digging up an identified cable • Sudden and accidental discharge of pollutants (clean up costs) • Employees are included – sub contractors should hold their own Insurance • Defective workmanship/property being worked on can be included under most liability Insurance policies – eg. The plumber forgets to crimp a connection for the shower unit. Walls are sealed up, waterproofed and tiled. When testing taps, water leaked in the internal wall, damaging the walls on the lower floor. Cover would be included for costs to remove the tiles, repair the crimp, waterproof and re-tile. Limited to $100,000 Whilst cleaning glass, some grit was in the cloth resulting in scratches to windows. Limited to $100,000. Incorrect installation resulting in damage to other property

Under Statutory Liability Insurance, cover can be included for any fines ordered by the Building Practitioners Board arising out of an action under the Building Act. Cover is also included for Legal Defence Costs.

It is important to always refer to your policy wording for full coverage details.

REDi Builders’ Insurance is administered by BrokerWeb Risk Services Limited and is exclusive to NZCB members. For a free review of your existing portfolio, you can contact BrokerWeb Risk Services on redi@bwrs.co.nz or 0800 644 444.