Insurance isn’t the most exciting of subjects but it is an absolute necessity for those in construction. As a busy builder or construction business owner, getting relevant and right cover, quickly, easily and at the most attractive price, is probably your goal.
And while there is nothing wrong with that, you should be aware that Construction Insurance can be quite complex, depending on the type of activities you carry out.
That is why we always recommend that you simply don’t buy the first policy you see online because it appears to give you the cover you need at a really cheap price.
Lots of choice but…
There are many types of policies out there ranging from simple tradesman policies to the more complex and robust Contractors All Risks insurance policies with a wide range of covers and extensions.
A simple tradesman policy that caters for a self employed builder can simply be bought online but a property developer will require something completely different. This is where things can go wrong and where you need to get the right cover in place because if it goes wrong, the error can be costly.
Risks of buying insurance online
Buying online can be full of pitfalls (if you get it wrong) – especially where online forms are concerned. In the event of you needing to make a claim, you could find that it is rejected for several reasons. Here are some examples:
- Some policies may not extend (or are inflexible) to cover other aspects of work you may undertake in the future leaving you without cover.
- People sometimes ‘misrepresent’ the area of their business trade in order to get a cheaper quote (eg., putting down General Builder when most of the work involves groundwork or demolition).
- Providing incorrect financial information about labour costs e.g. subcontractors and labour-only that are used.
- Not disclosing previous claims in order to get a cheaper quote.
- Not advising previous adverse business or financial history.
This is not an extensive list. It’s just a few important areas where we have seen claims rejected.
Will your claim be successful?
If you misrepresent or don’t give your insurance provider the correct information when applying for cover, you leave yourself (or your business exposed) to having any valid claims rejected. This can be disastrous and we’ve seen the results with clients that came to us.
Not only could your well-earned reputation be destroyed, but depending on the type of claim it is, your business could potentially go under. Imagine if an employee gets injured and you’re not covered?
Don’t forget that if a claim is rejected due to reasons of non-disclosure, it could also be classed as fraud. This could prevent you from getting further insurance and some other financial services in future. This may leave you unable to trade.
Don’t get caught out
Getting the most appropriate construction insurance cover for your circumstances is key to protecting your business now and in the future. As this can be complex, we advise you to follow these three simple rules:
- Always seek advice from specialist construction insurance providers or brokers who can guide you. More often than not, they are cheaper than online providers, too, because of their specialist knowledge.
- Advise your broker if you carry out any specialisms or something outside your ordinary day-to-day work activities.
- Never assume anything related to your cover – always ask.
If you need any advice or guidance regarding your existing or new cover, don’t hesitate to contact our expert Construction Team on 0207 731 3700 or send us an email.
We will be more than happy to help and make sure you have the most suitable protection for you and your business, at an easily affordable price.