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Construction and all-risk insurance
A construction project is a risk that changes every week and involves the developer, contractor, and subcontractors. The cover accompanies the entire schedule: work in progress, testing, reception, and the ten years that follow.
In short
What is construction insurance
The all risk construction insurance (TRC) covers damage to the work in progress and liability to third parties during the construction period. The decennial insurance is different and mandatory in residential building: it guarantees structural damage affecting the building's stability for ten years and requires the control of a technical control organisation from the project. Both complement each other and cover different phases of the construction's life.
Advantages
Advantages of construction insurance
On site, insurance is not an administrative formality: it is what allows signing, executing deeds, and getting paid.
No ten-year insurance, no deed
The notary and the registry require proof of it to register the new residential build. Without it, there is no delivery, no deed, and no payment.
Access public tender
Tender and performance guarantees are a condition for admission to the competition. Having them resolved and agile determines how many awards you can apply for.
The project continues after the incident
A partial collapse or a storm is resolved with reconstruction financing within weeks, without consuming the cash flow that supports the rest of your projects.
Avoid litigation with the subcontractor
With all parties designated as insureds, the damage is resolved within the policy instead of ending in cross-claims between companies that must continue working together.
Profile
Who we work for
Developers
Developers obliged to decennial and guarantee of advance payments, with liability to buyers for a decade.
Construction companies and contractors
Companies responsible for the executed work, subcontracting, and damage to adjacent properties.
Engineering and industrial assemblies
Installation projects with testing and commissioning, where the risk is concentrated in the testing phase.
Civil works and concessions
Public tender awardees with requirements for guarantee and extended liability.
Scope
Main covers of construction insurance
- All risk construction and assembly on the executed work, materials and work equipment
- Operational, cross and employer's liability during execution
- Damage to pre-existing property and adjacent constructions
- Trial period and commissioning in industrial assembly
- Maintenance period and warranty after receipt
- Ten-year structural damage insurance with OCT, and guarantee of advance payments
The JORI method
How we work
Risk analysis
We study the activity, assets, and plausible scenarios. Without that diagnosis, comparing policies is comparing prices of different things.
Programme design
We define covers, limits, deductibles, and acceptable exclusions. We decide what is transferred to the insurer and what is consciously retained.
Negotiation with the market
We present the risk to the insurers we work with and negotiate terms. We are independent: we do not belong to any company.
Support and claims
We review the programme at each renewal and, when a claim occurs, we act as your technical representative with the insurer until payment is received.
Frequent doubts
Most frequently asked questions about construction insurance
When is ten-year insurance mandatory?
In residential building, in accordance with the Building Regulation Act. It is a requirement to register the new build and to execute the deed. In non-residential construction, it is not mandatory, although many financiers and buyers still require it.
What does the guarantee of advance payments cover?
It guarantees buyers the return of the amounts paid before the delivery of the property, plus interest, if the work is not completed or not delivered on time. It is mandatory from the first payment and its absence results in direct liability for the developer.
Who should take out the CAR, developer or builder?
Either can take it out, but the key is that all parties involved are listed as insured. We recommend that the developer takes it out and designates the builder and subcontractors as insured, as this avoids conflict over subrogation within the project itself.
What are LEG clauses and why do they matter?
They are market clauses that define the extent of defect cover. LEG1 excludes all defective parts, LEG2 covers resultant damage excluding the defective part, and LEG3 is the most comprehensive. The difference between them can amount to millions in a structural claim.
Does the policy cover damage from rain or flooding on site?
Ordinary phenomena are covered within the CAR. Extraordinary ones are covered by the Consorcio. In projects with deep excavation or nearby watercourses, we negotiate specific sub-limits, as this scenario produces the most total claims.
How long does liability last after project delivery?
Ten years for structural damage, three for habitability damage, and one for finishes, according to the LOE. The ten-year insurance covers the first period; for the other two, it is advisable to maintain post-completion liability cover.
Construction
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