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Some home builders take out insurance only before requesting the Construction Inspection to legalize their building, but the number of people insured since the beginning of construction is increasingly conscious.
“What’s wrong with insuring at the end of construction? A person buys an insurance policy but does not receive a real benefit during construction when it is most needed, since the insurance protection only comes into effect from the moment the insurance contract is concluded. Such cases, when the contract is concluded late, not from the start of construction, still occur, ”says Gintaras Gurskis, risk advisor at the insurance company BTA Property Insurance Risk Division.
From several tens to several thousand euros
According to the expert, various disasters are constantly occurring during construction, and the damages range from several tens to several thousand euros.
“The most common risks of construction insurance are of three types: labor errors, intentional actions of third parties and property damage from natural disasters. Among the errors of the works: interruption of the electricity supply to other residents, heat pump burned due to poorly connected cables, damaged water property, poorly sub-concreted and deformed walls, collapsed chimney stacks. Among the consequences of intentional activities, we have a damaged house roof, stolen roofs, broken gates when thieves break into the territory ”, G. Gurskis mentions the facts.
According to him, nature also causes a lot of damage to home builders, including a wall damaged by the storm, a roof damaged by natural forces, slopes of roads washed away by heavy rain, a roof torn by the wind and air conditioning. . Such damages occur not only during the construction of new houses, but also during the modernization and renovation of apartment buildings. However, we estimate that the greatest losses continue to be caused by fires.
According to an insurance expert, sometimes clients, especially those building a home for the first time, are unaware that construction insurance covers particularly broad protection. During construction, the insurance protects against all possible risks: both the house under construction and the construction materials intended for the construction of that house are insured. If the house were damaged during construction, the insurance company would compensate for the damage suffered.
“The civil liability of the builder and contractors against third parties is prohibited. If neighbors or passersby are affected by the work, the scaffolding falls on the neighbor’s car, civil liability applies. When a person lives in a house, everything is supervised, there are no outsiders, but when construction takes place, a large investment is made in the property under construction, and there is no constant presence on the construction site, work is carried out risky. – the probability of damage is much higher, ”says G. Gurskis.
When is construction insurance mandatory?
Mandatory construction insurance is necessary when construction begins, not when it is finished, but some people are not even aware of this type of insurance, as houses are usually built once in a lifetime.
“Construction insurance is mandatory in two cases. When a company or a person does the work on a farm – all the work is done by the builder himself and does not conclude contracts with the builders or in a mixed way – when part of the work is done by the builder and part of the work is done by the builders , then he has the obligation to insure.
The obligation to insure also remains when the builder hires a general contractor who is responsible for the entire construction process. In this case, the obligation to insure lies with the general contractor ”, says G. Gurskis.
To complete the construction process, the Building Inspection requires construction insurance and inspects other necessary documents. Home builders who are uninsured from the start of construction receive retroactive protection in such cases.
