The following Insurance & Reinsurance practice note produced in partnership with David Savage of Charles Russell Speechlys LLP provides comprehensive and up to date legal information covering:
Decennial insurance is insurance that is taken out by contractors to cover costs associated with the potential collapse of a building after completion or discovery of latent/structural defects that compromise the building's safety or stability. The name derives from the fact that it covers the ten-year period after completion of the project.
Decennial liability exists in many countries and is enshrined in the relevant Civil Code of many civil law jurisdictions, such as France, Egypt, the United Arab Emirates (UAE) and Qatar. It is a form of strict liability which does not require any proof of fault or causation and applies to all defects whether patent or latent at the time of practical completion. It generally allocates the risk of serious structural defects to the designers and contractor jointly and severally. The liability cannot be limited or avoided even by way of express contract provisions or agreement between the parties.
By way of example, Article 715 of the Qatari Civil Code 22 of 2004 provides the following:
‘Any clause intended to exempt the engineer or the contractor from the guarantee or to limit such guarantee shall be deemed null and void.’
This position is mirrored in the following laws in the Middle East region: Article 882 of the UAE Civil Code, Article 620 of the Bahraini Civil Code, Article 697 of the Kuwaiti Civil Code, Article
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