Contractors all risks (CAR) insurance covers the physical risks of a construction or building project: the works themselves, the materials, and the plant and tools on site, against loss or damage from causes such as fire, theft, flood and accidental damage. It is the core cover for anyone carrying out construction work, protecting the value tied up in a project that is not yet finished and not yet the client’s.
A part-built project is uniquely exposed: it is valuable, it is on an open site, and it is not covered by an ordinary buildings policy until complete. Contractors all risks fills that gap for the life of the works.
What does contractors all risks insurance cover?
It typically covers the contract works, the permanent and temporary materials, and often the plant, tools and equipment on site, against sudden and accidental loss or damage. Common causes covered include fire, storm, flood, theft and vandalism, and accidental damage during the works. Cover usually runs from the start of the works to practical completion or handover.
Who needs contractors all risks cover?
Builders, contractors and tradespeople carrying out construction, renovation or extension work, and sometimes the property owner commissioning it, depending on the contract. Many construction contracts require CAR cover to be in place, and specify who must arrange it, so the contract terms are the starting point.
What else usually goes with it?
Contractors all risks is normally bought alongside the liability covers a construction business needs: employers’ and public liability for injury to workers and third parties, and, where design is involved, professional indemnity. CAR covers the works and property; the liability covers deal with harm to people. A construction business generally needs both.
Does it cover plant and tools?
Often, but not always automatically. Plant, tools and equipment can be included within a CAR policy or covered under a separate plant section, and hired-in plant may need specific cover because you can be liable for it under the hire terms. It is worth checking exactly what is included rather than assuming everything on site is covered.
Getting the cover right
The right CAR cover depends on the value of the works, the type of project and what the contract requires, and it needs to sit correctly alongside the liability covers. A broker can build the package for the way you work. To review your commercial cover, get a quote or speak to the team.