Castleacre Insurance Broker Melanie Ambrose explains ‘people do not always realise that if you are starting a building project at your home you need to advise your household insurer first. If you do not, this can invalidate your existing cover.
If you undertake major building works which exceed a certain value your household insurer will suspend cover during the works because of the increased risk. Homeowners can end up relying on their contractor’s insurance during a build project without realising that it puts them in a vulnerable position.
What happens if your builder walks off the project, goes bankrupt or doesn’t pay their insurance premium? If you have to prove that your contractor has been negligent any settlement could take months and you may need to fund alternative accommodation. The contractor’s insurance generally will not provide cover for other perils unrelated to works or provide the full cover for your buildings which is an essential requirement for mortgage providers.’
Renovation or Building Work policies cover your existing property, works, your liability as a homeowner and, on a joint names basis, both yourself and the contractor if required – this means you are unlikely to experience long drawn-out disputes if something goes wrong. If you live on a terrace, own a semi-detached house or have neighbours in close proximity these policies can also be extended to offer a vital add-on, called ‘non-negligence’ cover.
Melanie explains ‘in 1996 the Party Wall Law was introduced, partly in response to the popularity of basement and loft conversions. The law was designed to protect neighbouring properties when structural changes like excavations or extensions were undertaken and liability was placed on the property owner undertaking the construction rather than the contractor. Non negligence cover is a technical term for party wall protection; it ensures you are covered if your project creates any structural issues for neighbouring property.’
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