What Insurance Do Property Developers Need?

Posted by SELF BUILD INSURANCE on October 19th, 2022

A property developer is responsible for building a property from scratch or renovating an old or neglected structure and bringing it back to life. This is a very rewarding exercise but is also fraught with many issues. Since it involves massive amounts of money, resources and manpower, it is necessary to understand what insurance property developers need and that all the pertinent aspects are covered duly.

A competent property developer policy will help you cover all costs incurred during the whole construction phase, any loss or damage that may occur to plant and machinery or tools used during the process, any and all public liability associated with the project and any damage or liability that you may unwittingly cause to the surroundings.

How much coverage you can get depends on the project and its specific requirements. Ideally, you should look for what insurance property developers need, before any work begins. Even if your contractor has an insurance policy, it would still be better as some aspects may not be covered appropriately if you have all business and project details.

Some aspects that a property developer insurance quote includes are as follows-

1)      Building Damage- this includes any damage that building a foundation (subsidence) may cause to nearby properties, injuries or any other accidents.

2)      Public Liability- includes any accident suffered by someone entering your site, and includes trespassers too.

3)      RestrictiveCovenants- The previous owner may have these provisions in effect, and this could lead to delays or issues for you when it comes to extensions etc. These covenants do not affect you if you have insurance coverage of the right kind.

4)      Defective Title- Deeds or property title documents can get lost if not preserved properly, and this could stop your project from moving forward due to delays in paperwork. A good developer insurance policy will help you in such times and cover you if there is any issue related to rights of way, denial of access or easements etc.

5)      JCT Clause 6.5.1- This important clause covers any damage that your contractor or sub-contractor may cause to the surrounding property while working on your site.

6)      Plant and Tools Insurance

Since you are the site owner, you are bound by a few legal responsibilities, and so insurance cover is needed for all the points mentioned above. These are termed ‘Essential Cover for A Property Developer’.

The other optional features that your project may be covered for include-

1)      Insurance Cover Extension- for any unanticipated delay or otherwise.

2)      Non-negligent cover- to cover your neighbours, if required

3)      Land-only Cover- for the pre-build phase only

4)      Coverage for any temporary structures or buildings erected on site

A good property developer insurance quote never leaves anything to chance, and this is reinforced even if you have sub-contractors to do your work for you. Some elements of ownership may always be unclear if you rely on your contractors alone, and this does not help anyone. Getting a customised plan always helps.