If you're just starting out in the construction industry, you need to carry insurance before taking on any projects. Construction insurance protects you from losses that would result from paying for damaged property and materials, medical expenses and other mishaps that may occur on your site. Some forms of insurance are a mandatory requirement, while others are optional but great for preventing financial losses. Below are the four main insurance covers you need for your construction business.
Public Liability Insurance
Public liability insurance is essential for builders and other businesses that operate with or around members of the public. This coverage protects your business from losses resulting from third-party injuries and property damage. Examples of risks include the following:
In these cases, your public liability cover will pay for any damages, medical expenses or lawsuits resulting from the incidences. It also covers for legal damages on any deaths resulting from such accidents on your site.
Employer Liability Insurance
Employer liability insurance is the builders' version of workers' compensation. It covers the injuries, lawsuits, settlements, medical expenses, disabilities, loss of consortium and other costs incurred when your employees get injured on the site. However, the insurance policy only covers for injuries that didn't result from the victim's negligence. For example, if an unauthorised employee decides to operate the concrete pump and gets injured, they may not be compensated.
Course of Construction (COC) Insurance
Also known as construction all risk (CAR) insurance, this is coverage for the structure under construction. It covers the building and construction materials for the project from physical damage. Examples of items in the cover include construction materials, foundation, fencing, paving and other structure installed by the contractor, scaffolding and other temporary structures, outdoor fixtures and even lawns and landscaping features set up by the contractor. This cover is essential for all types of builds, including new constructions, remodels and additions.
Plant and Equipment Insurance
When running a construction project, you utilise various equipment and pieces of machinery which you may have bought or rented. The nature of the tasks exposes the equipment to physical damage, and repairs usually cost a lot of money. Plant and equipment insurance covers damage to all machinery on the site.
This includes excavators, forklifts, trenchers, loaders, graders, scrapers, bulldozers, pavers, dump trucks and boring machines among others. The policy also includes leased equipment as they are in your control during the rental period. However, not that it only covers damage and loss and does not cater to equipment breakdowns.
These are the most crucial insurance covers for your construction business. Talk to your insurer about the appropriate quantity for each cover to ensure you're not under-insured.
For more information, reach out to a company like National Corporate Broking Pty Ltd.Share
17 March 2020
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