Published on : 09 May 20222 min reading time
The importance of insurance in the construction industry
Insurance enables compensation to be paid in the event of damage occurring during the work. The same applies to rehabilitation and repair work. It is therefore important to take out construction insurance, the aim being to avoid the risk of poor workmanship. This guarantee covers the builder of the work and protects the company in question from material damage caused during the construction work. In general, it is a question of damage to work insurance or ten-year civil liability insurance. The objectives of these types of insurance are to cover the construction work and to reassure financial investors.
The legal obligations touched upon by the construction insurance
Generally speaking, there are two types of compulsory insurance for builders, namely damage to work and ten-year civil liability insurances. As a matter of fact, insurance laws require the builder to take out ten-year insurance as soon as the building site is set up and failure to comply can result in a prison sentence and a heavy fine. Ten-year insurance protects those involved in the construction industry if damage occurs that jeopardises the solidity of the work. The house becomes uninhabitable for a more or less long period. The damage to work insurance, on the other hand, provides for the refund of the full cost of repair, which affects any damage suffered at the time covered by the ten-year guarantee. The owner of the building is entitled to take out insurance, as is the vendor or agent, but also the property manager.
What about optional insurance?
Some risks are not covered by compulsory construction insurance, including minor damage which is not considered to be of a ten-year nature. The optional insurance policy, therefore, takes over the unprotected risks. This is also the case for builders not covered by compulsory insurance when they want to secure their activities. Basically, optional guarantees offer much more protection for construction workers.