Construction activity insurance. Insurance of investment and construction activities

2024 Author: Howard Calhoun | [email protected]. Last modified: 2023-12-17 10:16

Construction activity insurance is a mandatory procedure for the contractor's admission to the start of construction work. But today in the domestic construction market the situation has developed in such a way that the investor or customer does not have the right to choose a specific construction company. All orders are issued through tenders in which each construction organization can take part. Well, insurance of SRO construction activities will reduce the financial burden and will significantly reduce the costs associated with the construction of the facility and its commissioning.

Why you need insurance

In general, insurance guarantees the protection of the property of construction participants, reduces losses from destruction or damage to construction objects, property, necessary building materials, taking on all financial risks. All construction participants can act as insurers - from designers, engineers to lessees of special equipment. Each of them is interested in insuring their part of the work: architects and designers protect the project they have createdof a new building, engineers - their professional reputation, general contractors - risks of liability, lessees - special equipment provided for rent, etc.

Types of construction works insurance

In general, construction activity insurance is:

• turnkey insurance. In this case, the general contractor bears all responsibility for the construction, supply of special equipment and building materials, installation, commissioning;
• on the principle of "delivery and control" - involves insurance of property in construction activities, provision of the construction process with materials, necessary special machinery and equipment, employees, etc. by the customer himself. The general contractor maintains overall control over the installation and construction. Liability in this case is insured by representatives of the general contractor, and property risks are insured by the customer.

How the contract is drawn up

All property used on the construction site can be insured under the CAR-EAR system, which provides protection for buildings and temporary structures, process equipment, utilities and more. The insurance contract is concluded between representatives of the construction organization and the company's agent. The contract must specify the objects and processes to be protected. This is:

• construction works products;
• special machinery and installation equipment;
• temporary structures, as well as buildings intended for permanentrepair, reconstruction or demolition;
• results of the work of installers and engineers: laid engineering communications, installed equipment, etc.

A separate clause of the contract sets the start date of the insured period. In most cases, either the date of receipt of a building permit or the day of the immediate start of construction work is taken as a starting point. In some cases, a retroactive insurance period is indicated.

Providing coverage

The next obligatory clause of the insurance agreement is insurance coverage. It is provided on the principle of "protection against all risks". This allows the insurance company to support builders not only in the event of classic hazards: fires, natural disasters, civil liability to third parties, but also against specific risks that may arise. Among them, the most common are:

• designer mistakes;
• defects in building materials;
• shortcomings and blunders in the work of staff;
• damage caused by electric shock;
• cable breaks and other breakdowns of installation equipment;
• other.

Sum Insured

A mandatory clause of the insurance contract is the amount of compensation upon the occurrence of an insured event. During the period of direct construction, the total cost of the erected object increases from zero to the full market price. At the same rate, the amount ofinsurance premiums. But do not think that insurance of investment and construction activities is carried out remotely, and company representatives are limited to paper reports on the progress of work performed.

Each stage of building construction is subject to independent expert evaluation. Independent expertise evaluates the following factors:

• quality of construction at intermediate stages;
• quality of construction and installation works;
• observance of construction technologies;
• assessment of the measures taken and the means to ensure the safety of the built building;
• other.

An expert assessment can be provided by both an insurance company and an independent expert organization that has the right to make such conclusions. In any case, the conclusions of specialists must be brought to the attention of designers and builders. Also, these conclusions directly affect the final budget of the construction - the fewer comments on the work of builders, the higher the level of safety at the facility - the lower the insurance premiums.

Conclusion

Construction activities insurance, as you can see, is systemic in nature, in which all parties are interested in an objective and fair approach. Thanks to the implementation of insurance programs for unique objects, each concluded contract is universal. It may include the protection of all construction machinery and special equipment on site.construction sites, including what is used on the rights of short-term lease (leasing). This can also include accident insurance programs for workers and specialists, medical insurance, civil or professional liability of construction companies to third parties. Finally, the company itself, which insures construction activities, necessarily includes itself in international reinsurance programs that guarantee it the fulfillment of its obligations and the provision of payments in the most critical cases.