The following Construction guidance note Produced in partnership with Fladgate LLP provides comprehensive and up to date legal information covering:
A contract for insurance may cover damage to property caused by an insured risk, for example buildings insurance or contractor’s all risk insurance. The insured risk may be an act of God, or it may be caused by negligence.
Alternatively, an insurance policy will cover liabilities incurred in law, for example causing injury, death or damage to property by negligence. The insured event must be something which creates a liability in law, ie a tort. Public liability policies do not cover pure accidental damage, unless negligence is present. Public liability policies also commonly exclude liabilities undertaken under contract which would not have existed absent the contract.
In order to insure a building, the person taking out the insurance must have an insurable interest in the property. Generally the insurable interest is ownership of the building or, in the case of a mortgagee, a financial interest in the building. See Practice Note: Insurable interest.
In the case of a contractor, its insurable interest in the works is its contractual obligation to take care of the works until completion. Without that contractual obligation to take care of the works, a contractor has no insurable interest in the works. The contractor is therefore only liable, in respect of the works, for its own negligence causing damage.
In respect of
**excludes LexisPSL Practice Compliance, Practice Management and Risk and Compliance. To discuss trialling these LexisPSL services please email customer service via our online form. Free trials are only available to individuals based in the UK. We may terminate this trial at any time or decide not to give a trial, for any reason. Trial includes one question to LexisAsk during the length of the trial.
To view the latest version of this document and thousands of others like it, sign-in to LexisPSL or register for a free trial.
Existing user? Sign-in
Take a free trial
Take a free trial
0330 161 1234