Structural Warranties Checklist

Whatever type of property development you’re undertaking, it’s vital that you’re financially protected right from the start. At Construction Insure, we’ll advise you on the relevant insurance for your build to ensure your investment is safeguarded. Whether building a new build property, renovating an existing one to live in or have purchased a property to renovate as an investment, you must be aware of every aspect of your project and what insurance is required. Because problems can occur, you need to limit your liability as much as you can. To do this, you need to obtain the right insurance protection at the earliest stage of your development. The most appropriate cover, at this point, is Building Warranties Insurance, also known as Structural Warranty and Latent Defects. It’s the policy you need if you’re developing a new build; changing the usage of a building (converting from residential to commercial or vice versa); extending or increasing the size of the existing property by more than 50%; or if you’re intending to sell a property that’s under 10 years old. It’s not as complicated as it may sound and, at Construction Insure, we have many years of experience in protecting our clients in situations like these. We’ll work with you to ensure you’re financially and legally protected.

What else do you need to know?

The key aspect of a Structural Warranty policy is that it will cover your costs if a structural issue comes to light after your project is completed. For instance, if subsidence becomes apparent, requiring expensive remedial work. This type of problem won’t be covered by your Buildings Insurance, so, without a Structural Warranty policy, you could be severely exposed, financially. While we can obtain cover for you during the build and even after completion, we recommend putting a policy in place before your build begins. This will not only make the process of insurance more straightforward, but your premiums will be considerably less expensive too. Another point to consider is building regulation approval. At construction insure we can include a quote for building control so that you do not have worry or stress.

What else do you need to think about?

To get you the most comprehensive cover, at the most economic premiums, we’ll need to discuss all aspects of your property development with you. The types of information you’ll need to think about are: What is the reinstatement value of the retained structure? If you’re undertaking a new build, what will the reconstruction value be once completed? What is the Gross Development Value (GDV), or sales value? If you are building multiple structures, what are their GDVs and reinstatement values? What type of foundations are you using (for example, strip or piling)? What method of cladding are you using? What is the size of the project in square metres? If the property is to be added to your rental portfolio do you require cover for loss of rent? If you do, have you determined what the rental income will be? How long do require cover for: 8, 10, or 12 years? Are you happy for there to be a two-year developer liability period?

If your answer is yes, have you made sure that the JCT (Joint Contracts Tribunal) between yourself and the contractor is in place for that length of time?

Do you need cover for component failure: the failure of non-structural component parts, for instance, boilers, electrical wiring, pipe work, kitchen units?

Although there is a great deal to think about with Building Warranties, we’ll make the process as straightforward as possible. And we’ll be with you every step of the way, from brokering you the right insurance to advising you in the event of a claim.

How do you get the right advice?

We want to help you make your building development run as smoothly as possible. To find out how we can do that for you, please call us on 020 3958 6868 so we can talk to you about your build and get the cover that’s right for you.

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