What is builders liability insurance?
Within the construction industry, it is not unusual for hazards to occur from time to time. Builders' public liability insurance protects you should an accident occur that affects a member of the general public and they pursue a legal claim for negligence against you.
For example, if, during building work, materials were to fall and damage a nearby car or building, you would be held responsible for this. Having a builder’s liability insurance policy in place means that your legal costs would be covered, as well as any compensation you might have to pay out too.
Whilst it isn’t a legal requirement, it is strongly recommended. If someone was to make a claim against you without public liability insurance, the impact could be severely damaging to your construction business.
Furthermore, although it might not be a legal necessity, some clients, contractors or local authorities will not even consider working with businesses that don’t have builders public liability insurance and builders employers liability insurance in place.
Why do I need builders liability insurance?
Investing in builders liability insurance makes good business sense - not only will it ensure you're not limited as to whom you can work with as a builder, but it will protect you and the public in the event of any accidents.
What does builder’s liability insurance cover?
In the unfortunate event that you cause personal injury to either your clients or a member of the public, or cause damage to someone else’s property, then a builder’s liability insurance policy would cover the legal fees, medical expenses, the cost of any repairs, as well as any compensation due.
The nature of construction and building work means that there will be times when you are working in close proximity with the public and their private property. Even when due diligence is taken, accidents can still happen.
Builders public liability insurance will typically cover:
- Accidents or damage that occurs whilst working at your premises or on a commercial or residential building site.
- Accidents or damage that occurs due to your work, faulty materials, equipment or tools.
- Accidents or damage that occurs whilst building new structures or converting, extending or changing existing structures
For example:
- Bricks falling on a member of the public
- Damage caused to a nearby car
- A member of the public falling while on your construction site
What isn’t covered by builder's public liability insurance?
Builder's public liability insurance is specifically for damage relating to members of the public or public property. As a result, this type of insurance does not cover any accidents or injuries relating to you or your employees.
Accidents relating to you or staff would be covered by employers liability insurance and unlike builder's liability insurance, this is a legal requirement in the UK.
In addition to this, if you were to damage. lose or have stolen your tools, equipment or property, then your builder's public liability insurance policy would not cover this. Again, you’d need to take out extra cover for this kind of damage, such as tradesman's tools-only liability insurance.
It is vital that you read the terms and conditions of any builders' public liability insurance that you purchase, as they can vary.
Do I need other types of insurance?
Builders' public liability insurance will cover any damage caused by building and construction work. However, it’s not uncommon for these kinds of projects to also include additional trades, including electrical or plumbing work.
As such, you might wish to consider:
Talk to our brokers about how a combined builders' public liability insurance policy can be tailored to your individual business's requirements.
Builders insurance - Frequently asked questions
How much is a builders' liability insurance policy?
The cost of your insurance policy will depend on several unique factors, such as:
- Your annual business turnover
- The level of cover - public and/or employers liability - you require
- Your age, location and relevant experience
- Number of employees
- Your exposure to dangerous, toxic or hazardous materials
- Previous claims experience
How much insurance cover will I need?
Again, this will largely depend on the size of your business and the kind of building work that you carry out.
The more you are covered for, the higher your premium will be. However, it’s essential to make sure you take out enough cover to ensure you are adequately protected.
Many insurers offer public liability insurance in 'bands' of indemnity, such as £1m, £2m, £5m etc. If you are working on construction projects in the public sector, such as for local government, there is usually a requirement for a minimum level of cover of between £5m and £10m.
Do I require builders public liability insurance if I am self-employed?
Ideally yes. Even if it is just you carrying out the building work, you could still make a mistake or cause an accident, and so it’s best to be covered in the event this happens.
Is builder's public liability a legal requirement?
No, it is not a legal requirement in the UK. However, it is strongly advised from both an ethical and business perspective. Not only does it increase the likelihood of third parties working with you, but ensures you can adequately and fairly compensate the public should an accident happen.
How can QuoteRack help with builders liability insurance?
Quotations for builders insurance is available from FCA-authorised insurance brokers who specialise in this type of construction industry cover. By providing the details of your builders insurance requirements, you will be contacted by insurance brokers who will be happy to provide builders liability insurance quotes without cost or obligation.
Regardless of the size of your building company, we can help you find the right cover for all aspects of construction, including preparation of plans and specifications, cover for your staff, plant and machinery, tools and equipment - you name it, if cover is available our specialist insurance brokers will help you find the best available quote for your building contractors insurance.
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"Arranging liability insurance for builders and building sub-contractors is a highly specialised area and requires the experience and knowledge of insurance intermediaries who are familiar with the construction industry insurance market"
"In the construction business, premiums for builders liability and other insurances have risen over the years - it is a simple and straightforward process to compare quotes for builders insurance from specialist insurance brokers"