Contractors’ All Risks (CAR) Insurance
Produced in partnership with Gordon Dadds Consulting LLP, revised in partnership with Hardwicke
Contractors’ All Risks (CAR) Insurance

The following Construction practice note produced in partnership with Gordon Dadds Consulting LLP, revised in partnership with Hardwicke provides comprehensive and up to date legal information covering:

  • Contractors’ All Risks (CAR) Insurance
  • What is Contractors’ All Risks insurance?
  • Who takes out the CAR policy?
  • Who is covered by CAR insurance?
  • Insured Parties
  • Noted Parties
  • Scope of cover provided by CAR insurance
  • What risks does CAR insurance not normally cover?
  • Exclusions from a CAR insurance policy
  • Common extensions to CAR insurance policies

Contractors’ All Risks (CAR) Insurance

What is Contractors’ All Risks insurance?

Construction insurance comes in two main categories, namely ‘property’ and ‘liability’ insurance. Property insurance refers to cover for damage caused to physical property, and can be extended to cover consequential losses (eg business disruption, loss of profits etc). Liability insurance refers to cover for claims against the insured by third parties, contractors, employees, etc, for personal injury, property damage or loss of profits. Insurance for damage caused to construction works is known as Construction All Risks, of which Contractors’ All Risks (below referred to as ‘CAR’) is a form. Contractors’ All Risks is a Construction All Risks insurance drafted in such a way as to identify the person who is to have the benefit of the insurance, rather than the damage that is covered. The insurance market has not arrived at a set of agreed standard definitions, and underwriters continue to develop their own specific wordings to cover the needs of the market.

Contractors’ All Risks insurance usually comes in three types of cover, or combinations thereof:

  1. cover for damage to insured property, indemnifying the insured against physical damage to the construction works

  2. consequential or ‘business interruption’ cover, provides for financial losses suffered as a result of physical damage to the construction works

  3. liability cover against third parties, indemnifying the insured against liabilities for loss and

Popular documents