Material Damage Cover
- Physical loss or damage to the contract works
- Tools, plant, and machinery used on site
- Materials in transit and storage
- Temporary works and formwork
Contractors All Risks
Construction projects involve a wide range of risks — from damage to materials and equipment on site to third-party injury and property damage. Contractors All Risks Insurance helps protect the financial investment in construction works by providing comprehensive cover tailored to the unique exposures of building and engineering projects.
What Is Contractors All Risks Insurance?
Contractors All Risks (CAR) Insurance is a flexible insurance solution designed to cover physical loss, damage, or injury arising during the course of a construction project.
CAR policies typically combine:
- Material Damage Cover — for loss or damage to the works, materials, plant, and equipment involved in the project; and
- Third-Party Liability Cover — for legal liability to pay compensation for third-party injury or property damage arising from construction activities.
This insurance is usually arranged on an annual or project-specific basis, depending on the scope and duration of the work.
Who Needs Contractors All Risks Insurance?
CAR is often a contractual requirement under building contracts and sub-contracts, and it can form a key part of the risk management arrangements for construction projects of all sizes.
Types of companies
Contractors All Risks Insurance is relevant to a broad range of clients involved directly or indirectly in construction and engineering work, including:
- Main contractors and sub-contractors
- Developers
- Housebuilders
- Civil engineering firms
- Specialist trades (e.g., scaffolding, electrical, roofing)
Why Contractors All Risks Insurance Matters
Construction sites are inherently risky environments. Damage or loss can arise from numerous causes including fire, flood, storm damage, theft, impact damage, or accidental mishaps.
Without adequate insurance in place:
Repair and reinstatement costs fall directly on the business or project owner
Third-party legal claims can lead to significant liabilities
Contractual obligations may be breached
Contractors All Risks Insurance helps ensure that unforeseen events do not compromise the financial viability of the project or lead to disputes between parties involved.
What Contractors All Risks Typically Covers
Third-Party Liability Cover
- Injury to third parties arising from the project
- Damage to third-party property caused by construction operations
Policies may also offer optional extensions such as:
- Delay in Start-Up (loss of anticipated profits due to delays)
- Defects Liability Cover
- Existing structures and renovation projects
- Cover for hired-in plant
Contract and Project Specifics
Contractors All Risks policies are typically tailored around the specifics of the project, including:
- Project value and contract sum
- Duration of the works
- Location of the site
- Types of construction activities and materials
- Sub-contractor involvement
These factors influence both the availability and pricing of cover, as well as any special terms or conditions that may apply.
Coordinating with Other Insurance
CAR is often arranged as part of a wider insurance programme for construction businesses alongside:
- Employers’ Liability Insurance
- Commercial Motor Insurance
- Professional Indemnity Insurance
- Public & Products Liability Insurance
This helps ensure that all exposures — from workplace liability to professional advice risk — are appropriately addressed.
Arranging Contractors All Risks Insurance
At Commercial Insurance Solutions, we work with contractors, developers, and construction professionals to design CAR Insurance solutions that reflect the scale and nature of their projects.
We can assist with:
Reviewing your contract requirements and risk exposures
Structuring CAR cover for single projects or annual programmes
Advising on appropriate sums insured and policy limits
Discussing relevant extensions and optional covers
For clear, commercially sensible advice on Contractors All Risks Insurance or to discuss a quotation, get in touch with Commercial Insurance Solutions today.