Third Party Insurance??

[Pants7478512]

Hello,

I've had a quick search of the forums but can't really find a definitive answer to my question, hopefully somebody may be able to help. In the coming months I will be having a single storey extension to the back of my semi-detached house, the building works will be quite close to my neighbours extension.

As I understand I will have to be prepared to foot the bill if I cause any structural damage to my neighbours property (i.e, subsidence). Is there an insurance policy/indemnity policy you can take out to cover such building works? Otherwise will the builders public liability or my house insurance cover this?

Any thoughts would be much appreciated.

Thanks

 

[jeds]

Yes, there are insurances for that. There are standard protocols for insuring building works and you must be careful to get it right, otherwise it can cause serious headaches later. The way it should work is that your builder takes out a policy (which you pay for) in joint names with all the parties - that means in both your names, but could also include sub-contractors.

Good builders will have a running cover where it is just a question of adding the project and names of parties to a schedule. This is often done after the works are finished - i.e. at the end of the year. If requested the insurance company will provide details of cover at any time when asked for it.

Basically, ask your builder to provide cover in joint names and ask for a cover note before works start. If they don't know what you're on about - move on to the next builder. As I said, you will be expected to pay for the cover, charged as a proportion of the builders annual premium.

 

[Blagard]

Your normal House Insurance will not cover this.

The Builders Public Liability Insurance may cover him if he damages the adjacent property. However since he is employed by you, your neighbour may wish to claim from you and in turn you will try and claim from the Builder.

Be very careful about what damage he is responsible for.

If it is your design (plans you have had done and passed to him) and he builds it properly, but unforeseen conditions cause a problem to occur next door, I doubt the builder would be found to be at fault and since your project caused the problem you would foot the bill.

The best "contract" to have is when the builder has responsibility for design as well and so takes most of the risks.

I believe the JCT has new contracts especially for homeowners and you should look to see which is most suitable for your needs. Have a look here.

http://www.jctltd.co.uk/stylesheet.asp?file=22072005151711

There are so many angles on Insurance issues all I can do is kick off by saying first look to your contract with the builder to see who is responsible for what.

Edit: As Jeds has noted there are polices and the the requirement for this will normally be included in the JCT contracts to accept or delete. I have linked to the wrong page above but the contracts are in the JCT somewhere

http://www.jctltd.co.uk/stylesheet.asp?file=22072005151407 Hopefully!
Final note! - It is all well asking for one party to do the insurance, but you need to make sure they have. You need to see proof the insurance is being paid for not just the policy wording. - This type of insurance is not required by law and if one party fails to take it out all you can do is Sue!

 

[Blagard]

While I have not downloaded the Extension contracts because there is a charge for them if you want one. I found the following maintenance contract for small jobs on the same website. This one is free to download and gives you a feel of the language used in these JCT contracts. You will I am certain find the insurance provisions in the other versions much more extensive.

http://www.jctltd.co.uk/stylesheet.asp?file=04052006104401

 

[Pants7478512]

Thanks Jeds and Blagard, your comments are very helpful.