Construction Fires and Insurance

By Cliff

When it comes to insurance in the building industry, knowledge of construction fire risks, and how to minimise them, is essential.

The UK’s construction industry loses in the region of £400 million each year through construction fires. Most of these fires can be attributed to human error.

Common causes of fires include hot works, arson, faulty wiring/cabling or electrical appliances and open flames (including cigarettes).

A number of clauses are often included in construction contracts that impact liability and loss recovery. Two are summarised below.

Joint name insurance policies
Taking out an insurance policy in joint names can prevent the insured parties from claiming for losses against each other. This is because the overall loss is covered by a single policy, even though it covers more than one party.

Sometimes, construction companies and their building contractors take out joint name insurance policies for specific building projects. However, if a claim is made, future premiums may increase for all named parties in the original insurance policy.

Waiver of subrogation
A waiver of subrogation prohibits an insurer from recovering the money they paid on a claim from a negligent third party. A main construction contractor could use a clause like this to avoid being held liable for damage caused by fire or another type of accident on-site.

Need assistance?
Our specialists help clients to set up the appropriate type of insurance, and we also provide a full claims management service. Call us on 01525 719955 or email and ask for help.


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