A self build insurance policy will protect you and your project against a range of risks, so make sure you organise the right documentation before starting your self build.
Image: Insured with warranties Architect duo Eilir Sheryn and Fredericke van Ellen (01364 653 503; vanellensheryn.com) designed and built their family home in Ashburton, near Newton Abbot. The energy-efficient, timber-frame property measures 340sqm and cost £325,000 to build. The couple took out self-build insurance at a cost of around £800 for the year, which also covered liability, plus warranties for the Sarnafil roofing and the Velfac windows.
Self build site insurance
Also called contract works insurance, a site insurance policy will protect you and your project against a range of risks. This includes environmental issues (storms, flooding) and fire affecting the main house, as well as covering temporary buildings on the site, such as a site office or a caravan. What’s more, it will protect what you are constructing.
Make sure your self build insurance includes any professional fees, plot clearance and debris removal in the event of a claim. Your cover should also protect you against theft – paying out if someone comes on to site and steals tools or materials. In most cases this will include personal effects belonging to employees, though the limit is usually rather low. Of course, it’s up to you to keep the site locked when not in use – and most insurers will insist on a high level of security.
As soon as the deeds for the plot are in your name you will be responsible for your site, so think about how you are going to get protection from the start with self build insurance.
Your tradespeople and contractors may have their own insurance, but the buck for any accidents may still rest with you. Therefore, it’s essential to have public liability cover in place from the off and for the duration of the build.
If someone, even a trespasser, came on to the site and injured themselves you might be held legally responsible, which means you could end up with a big compensation bill. Your self build insurance policy should typically cover public liability up to £5million. It is possible to obtain products that last 12, 18 or 24 months, and if your project completes before the cover ends you should be able to convert the remaining time into regular buildings insurance.
Alternatively, if your scheme overruns, you should be able to extend shorter policies. The level of indemnity will vary between policy providers, but will typically cover the following as standard:
- Building works
- Plant, tools and equipment (owned or hired)
- Temporary residence (such as a caravan) plus employees’ personal effects
- Personal accident (including broken bones)
- Public and employers’ liability
- Legal expenses
- Your personal possessions
Structural warranties (Latent defects insurance)
Any significant structural defects that aren’t immediately apparent will usually appear in the first two years after completion. A structural warranty (sometimes referred to as latent defects insurance) is the conventional method of covering these risks.
Throughout your self build, your warranty provider will arrange visits at regular intervals to confirm that the house has been built to a satisfactory standard at each stage and issue relevant certificates to this effect.
At the completion stage you will receive the final certificate – this shows that your house is now officially complete and covered by the warranty. Keep this safe as it is a highly important document that should remain with the house paperwork and be passed on to any subsequent owner.
Warranties will pay out to put right any physical damage caused by defects in the structure, such as in the foundations or load-bearing elements, as well as for reasonable living costs incurred during the remedial work. Standard warranties last for 10 years and are invariably charged as a single premium. They will cost anything from £1,500 to £5,000, depending on the size of your house and complexity of the project.
An alternative to a standard warranty is to use an architect’s certificate. It’s a signed legal document that confirms that the house has been supervised during the construction period and that it complies with Building Regs and follows best practice construction standards. It should cost around £1,000 and will be valid for six years – but it’s not a self build insurance policy. If anything goes wrong, it is up to you to prove the cause of the fault and claim against the architect’s professional indemnity insurance.
- Arrange self-build site insurance.
- Arrange warranty providers.
- Notify building control and warranty provider as soon as work commences on site.
- Organise Energy Performance Certificate, Completion Certificate from building control and Warranty Certificate – all will be needed for a mortgage.
- Keep a site diary throughout the build to log your build’s progress and any changes to the initial self-build plan for reference if any disputes arise.
- Keep all policies safe, but readily available
- Federation of Master Builders (01353 652 760; fmbinsurance.co.uk) Insurance services for all building work, as well as warranties to cover building work from new homes to extensions, plus insurance services. offering employers and public liability insurance, tool insurance and van cover.
- NHBC (0800 035 6422; nhbc.co.uk) Offers warranty and insurance cover for builders, developers, self-builders and custom builders.
- Self-Build Zone (0345 230 9874; selfbuildzone.com) Offers site insurance, structural warranty and contract templates.