Working in construction comes with a wide range of risks. From working on customers’ properties and construction sites to managing employees, tools, machinery and ongoing projects, contractors need to consider how different parts of their business are protected.
There isn’t one insurance policy that will suit every construction business. The cover a contractor may need will depend on factors such as the type of work they carry out, whether they employ staff, the equipment they use and the projects they undertake.
In this guide, we look at some of the main types of insurance that building contractors and construction businesses in Northern Ireland may need to consider.
What Does Construction and Contractors Insurance Cover?
Construction and contractors insurance can combine different types of cover designed to protect a construction business against the risks associated with its work.
Depending on the business and policy selected, cover may include:
- Public Liability Insurance
- Employers’ Liability Insurance
- Contractors’ All Risks Insurance
- Contract Works Cover
- Plant and Machinery Cover
- Tools and Equipment Cover
- Business Interruption Insurance
- Legal Expenses, where available
The appropriate combination of cover will depend on the individual construction business and the work being undertaken.
For example, a self-employed tradesperson with a small number of tools may have very different insurance requirements from a building contractor employing a team and managing several construction projects.
Public Liability Insurance for Building Contractors
Construction work often takes place on customers’ properties, building sites and other locations where members of the public or other businesses may be present.
Public Liability Insurance is designed to protect a business against claims arising from injury to third parties or damage to third-party property in connection with its business activities, subject to the terms and conditions of the policy.
For a building contractor, this could be particularly important because even relatively routine construction work can involve the risk of accidental injury or property damage.
Is Public Liability Insurance Legally Required in Northern Ireland?
Public Liability Insurance is generally not a legal requirement for businesses in Northern Ireland.
However, contractors may find that customers, main contractors or organisations they work with require an appropriate level of Public Liability Insurance before work can begin.
The amount of cover required can depend on the work being carried out and any contractual requirements involved.
Employers’ Liability Insurance for Building Contractors
Construction businesses employing people also need to consider their responsibilities towards their employees.
Employers’ Liability Insurance is designed to provide protection against claims arising from employees suffering injury or illness as a result of their work, subject to the terms and conditions of the policy.
Do Building Contractors Need Employers’ Liability Insurance in Northern Ireland?
Businesses in Northern Ireland that employ staff are legally required to have Employers’ Liability Insurance.
However, individual circumstances can differ, particularly where businesses use different employment arrangements or subcontractors.
Contractors should make sure they understand their legal responsibilities and that the insurance they arrange reflects how their business actually operates.
Contractors’ All Risks Insurance
Contractors’ All Risks Insurance can provide important protection for contractors carrying out construction projects.
While liability insurance is primarily concerned with claims made against the business, Contractors’ All Risks cover can help protect the construction work itself against certain types of loss or damage, depending on the policy.
Cover may include contract works, materials and other property associated with a construction project.
The exact protection provided will depend on the policy selected, so contractors should make sure the cover reflects the type and scale of the projects they undertake.
What Is the Difference Between Contractors’ All Risks and Public Liability Insurance?
Although both may form part of a contractor’s overall insurance arrangements, they are designed to protect against different risks.
Public Liability Insurance generally provides protection where a third party suffers injury or property damage as a result of the contractor’s business activities.
Contractors’ All Risks Insurance can provide protection for the construction project itself, such as contract works and materials, against insured loss or damage.
Depending on the contractor and project, both types of cover may therefore be relevant.
Where Can I Get Contractors’ All Risks Insurance in Northern Ireland?
Contractors’ All Risks Insurance can be arranged through commercial insurance brokers that work with construction businesses.
At Dolmen Insurance, our commercial insurance team works with contractors and construction businesses across Northern Ireland to help arrange insurance based on their individual activities and requirements.
Rather than taking a one-size-fits-all approach, our team can discuss the work you undertake and help you explore suitable cover for your business.
Tools, Plant and Machinery Insurance
Tools, plant and machinery can represent a significant investment for a construction business.
Damage, loss or theft of important equipment can also make it difficult for a contractor to continue working, which is why appropriate insurance for this equipment can form an important part of a construction insurance package.
Tools and Equipment Cover
Tools and Equipment Cover can provide protection for tools used as part of a contractor’s work, subject to the policy terms, conditions and exclusions.
The appropriate level of cover will depend on factors such as the type and value of the equipment used by the business.
Plant and Machinery Cover
Construction businesses may also use valuable plant and machinery as part of their operations.
Plant and Machinery Cover can help protect eligible equipment against certain types of loss or damage, depending on the policy arranged.
Businesses using specialist or high-value equipment should make sure their insurer or broker understands what equipment they use and how it is used.
What About Hired-In Plant?
Some construction businesses hire equipment rather than owning everything they use.
Insurance requirements for hired equipment can differ from those for equipment owned by the business. Contractors should therefore discuss any hired plant or machinery with their broker when arranging cover.
Where Can Contractors Get Cover for Tools, Plant and Machinery in Northern Ireland?
Construction insurance packages can include cover for tools, plant and machinery depending on the needs of the individual business and the policy selected.
Dolmen Insurance works with construction businesses and building contractors across Northern Ireland to help arrange insurance that reflects their equipment, activities and wider business risks.
Contract Works Cover
Construction projects can involve significant investment in materials, labour and partially completed work.
Contract Works Cover can provide protection against insured loss or damage to work being carried out as part of a construction project.
The cover required can depend on the value and nature of the project, so contractors should provide accurate information about the work they undertake when arranging their insurance.
Other Insurance Construction Businesses May Consider
Construction businesses can face risks beyond liability, equipment and contract works.
Depending on the individual business, additional insurance options may include Business Interruption Insurance and Legal Expenses Cover.
The suitability of these covers will depend on the circumstances of the business and the insurance policy selected.
What Insurance Does a Small Building Contractor Need?
There is no single insurance package that every small building contractor needs.
A contractor’s requirements can depend on:
- The type of construction or trade work carried out
- Whether the business employs staff
- The number and type of projects undertaken
- The value of tools, plant and machinery
- Whether equipment is owned or hired
- Contractual requirements from customers or main contractors
- The size and structure of the business
A small contractor should therefore consider the risks associated with their own activities rather than simply choosing insurance based on the size of the business.
What Information Might You Need When Getting Construction Insurance?
Providing accurate information about your business can help your broker understand the risks involved and identify suitable insurance options.
Depending on the type of insurance required, you may be asked about:
- The type of construction work you undertake
- The size and structure of your business
- The number of employees
- Your use of subcontractors
- The type and value of tools or equipment
- Plant and machinery used by the business
- The type and value of construction projects undertaken
- Your previous insurance and claims history
Additional information may be required depending on the business and the type of cover being arranged.
Why Use a Construction Insurance Broker?
Construction businesses can have complex insurance requirements because the risks involved can vary depending on the work being carried out, the people employed, the equipment used and the projects undertaken.
A construction insurance broker can take these factors into account and help you understand the different types of cover that may be appropriate for your business.
At Dolmen Insurance, we work with construction businesses and building contractors across Northern Ireland to help arrange insurance based on their individual activities and requirements.
Whether you need cover for liability risks, contract works, tools, plant and machinery or a combination of covers, our commercial insurance team can discuss your requirements and help you explore suitable options.
Frequently Asked Questions About Construction Insurance in Northern Ireland
What insurance does a building contractor need in Northern Ireland?
The insurance required will depend on the contractor’s activities, employees, equipment and projects. Common covers can include Public Liability, Employers’ Liability, Contractors’ All Risks, Contract Works and cover for tools, plant and machinery.
What does construction and contractors insurance cover?
Construction and contractors insurance can include several types of protection, including liability insurance, Contractors’ All Risks, Contract Works, tools and equipment, plant and machinery and other business covers. The exact cover will depend on the policy selected.
Do building contractors need Public Liability Insurance?
Public Liability Insurance is generally not legally required in Northern Ireland, but it may be required by customers, main contractors or as part of a contract. It can protect against claims involving third-party injury or property damage, subject to the policy terms.
Do building contractors need Employers’ Liability Insurance?
Businesses employing staff in Northern Ireland will generally be legally required to hold Employers’ Liability Insurance, although there can be exceptions depending on the circumstances. Contractors should ensure they understand their legal obligations when employing people.
Where can I get Contractors’ All Risks Insurance in Northern Ireland?
Contractors’ All Risks Insurance can be arranged through commercial insurance brokers offering construction insurance. Dolmen Insurance works with building contractors and construction businesses across Northern Ireland to help arrange cover based on their individual requirements.
Disclaimer
The information provided in this blog is for general guidance and informational purposes only. While every effort has been made to ensure accuracy at the time of publication, Dolmen Insurance Brokers Limited accepts no responsibility for any errors, omissions or changes in legislation. Insurance policies and cover requirements may vary depending on individual circumstances. This blog does not constitute legal, financial or insurance advice.
Readers should seek professional advice tailored to their particular circumstances before making any insurance decisions.
Dolmen Insurance Brokers Limited is authorised and regulated by the Financial Conduct Authority under Firm Reference Number 978635.
