Self-Build Zone discusses the different types of insurance available for selfbuild and renovation projects, from builders and site insurance to warranties, and explains why knowledge is so crucial
Doing a self-build doesn’t actually mean you have to be building your project yourself – you could have a builder, contractor, be doing it yourself, or a combination of the above. Whether it’s you or a builder building your home, you need to make sure certain aspects are covered during your build.
It’s important to note that you need cover even if you haven’t started work. If you‘ve purchased a plot you need public liability cover – if someone were to go onto your building plot and get injured then it means you could be liable if they wished to pursue legal action. If you have an unoccupied property you need unoccupied buildings cover, especially in the case of barn conversions or renovation projects.
When extending or renovating you home your normal home insurance will most likely not cover you, as altering the structure of your home is usually an exclusion on home insurance policies. Therefore any extension project, or renovation that includes structural changes your home, will require additional insurance.
While your builder or contractor may say they are ‘fully insured’ – and probably believe it themselves – the chances are they actually only have some form of public liability. This covers them in the event they cause damage or injury to a third party following a negligent act (something you would have to prove). What public liability doesn’t cover is issues like storm damage, theft of materials, theft of plant, arson, or ‘foreseen liability’ – essentially all the things you really do need covered.
Do not expect a builder or tradesman’s policy to cover loss or damage to the existing structure or new works. Nor will it cover your liabilities as the owner of the property and site.
Make sure you see evidence of any policies that they do have and keep a copy if possible. Do not trust what they say – only what you see.
It’s also worth remembering that in order to succeed in an action against your builder, tradesman, supplier or professional you will need to prove breach of contract or negligence against them, which can be a lengthy and very expensive process.
Site insurance is the insurance you need during the actual construction phase of your project. It covers you from the moment you start the build, including all your liability cover, and the existing structures onsite.
Site insurance from the right provider can cover new builds, extensions, renovations and conversions but not all providers will be able to cover for all construction methods. For this reason it’s important to go direct to the providers and not rely on comparison sites. Ask yourself, if something were to go wrong could you afford to cover the costs? Site insurance is the cover that will protect you in this instance.
A structural warranty is a not only a requirement by lenders in the UK, but also a type of protection anyone doing a self-build should consider in any case. Even if you aren’t using a lender to fund your build, if you were to attempt to sell the property in the next 10 years, the buyers would require you to have one if they are using a mortgage or lender to purchase your property. It’s best to arrange your warranty provision before you start, as it can cost a lot more if work has already started or even completed.
WHAT TO LOOK FOR IN INSURANCE PROVIDERS
If you are using an insurance provider for site insurance, and/or a warranty, you need to make sure they are backed by an A-rated insurer. When shopping for insurance and warranties you need to consider that you get what you pay for. Don’t be focused on the cheapest price – what’s important is what’s included in the product, such as who’s doing your surveys, and what their integrity is like.