Construction

In a construction project, the developer, contractor, and subcontractors coexist under the same risk, and the allocation of responsibility is decided in the policy's list of insured parties rather than in the execution contract. The project schedule and the cover schedule must coincide section by section.

Where the claim enters

Works in progress, testing, handover and ten-year guarantee

What decides the claim file

The construction is insured in sections, and each section responds with a different scope.

The all-risk construction is structured in phases —execution, testing, reception, and maintenance— and each has its duration, scope, and sub-limits. Alongside, there are commitments with their own schedule: the ten-year insurance, which relies on a technical control organisation present from the project phase, and, in residential promotion, the guarantee of the amounts paid on account, enforceable from the first payment by the buyer. What is signed before the layout conditions the next ten years.

Who is listed as insured in the CAR
If subcontractors do not appear in the list of insureds, the insurer indemnifies and then recovers from them within the work itself, because no one can subrogate against their own insured and they are not. Designating them closes that route. Cross liability resolves the inverse problem: it allows the parties involved to claim against each other as third parties despite sharing the status of insured.
The maintenance period, broad or simple
In its broad form, it covers damages that manifest after reception and originated during execution; in the simple form, only those caused when rectifying defects. The form is chosen when contracting, because once the work is received, the scope is fixed for the entire warranty period.
The sub-limit for damage to adjoining properties
In urban work with party walls, subsidence and vibrations are the usual cause of claims from adjoining properties, and the guarantee travels by sub-limit within the all-risk construction. The notarial record of the prior state of neighbouring buildings supports the file as much as the policy.
The tests and their agreed duration
The commissioning is the section that the terms and conditions detail most: it sets a maximum duration for the tests, four weeks in many contracts, and usually excludes the equipment used. This period is negotiated while the test schedule is being drawn up, when it can still be adjusted to the actual duration of the commissioning.

What is contracted here

The covers that support a company in this sector

Each one is designed based on the company's real exposure. None are contracted the same in two companies in the same sector.

Frequently asked questions

Lo que nos preguntan en construction

Who should contract the all-risk construction, the developer or the contractor?

Either can do it; the key is that the developer, contractor, and subcontractors are listed as insureds and that the policy includes cross liability. When the developer contracts it and designates the rest as insureds, it prevents the insurer from indemnifying and then recovering from a company that continues to work on the same project.

How long is a work liable after delivery?

The Building Regulation Act sets ten years for structural damages, three for those affecting habitability, and one for finishes, and these periods apply to all buildings covered by its article 2. The ten-year insurance of article 19 is mandatory in buildings whose main purpose is housing, and it is there where the notary does not authorise the new construction deed nor does the registrar register it without the policy. In industrial, logistics, or office buildings, this requirement does not exist, although the ten-year liability of article 17 remains: it is maintained by voluntarily contracting the ten-year insurance, which is what the financier or future buyer usually requests, and reinforcing the civil liability after the works.

Can the ten-year insurance be contracted with the work already started?

The decennial is issued based on the monitoring of a technical control body that intervenes from the project phase, so seeking the policy with the structure already erected puts it out of reach. Therefore, the decision is made while the project is still open, also in industrial and tertiary assets, where contracting is voluntary and usually requested by the financier: the schedule that prevails is that of the control body, and it starts before the construction.

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