Don’t Rely on Your Builder’s Insurance: Protect Yourself!

When planning an extension or renovation, it’s easy to assume that your builder’s insurance will cover any mishaps during building works or that your standard home insurance has you covered. But here’s the cold reality: neither may fully protect your project.

Most builders’ insurance policies only provide limited protection while they’re on-site, and often exclude theft, fire or storm damage. To make matters worse, many of these policies cover only the new works, leaving your existing structure exposed. If disaster strikes your home during construction, you might be footing the bill not just for the works in hand, but for repairs to your existing home.

Even when your builder claims they’re ‘fully insured’, that usually means they have public liability insurance, which only covers damage or injury to third parties due to negligence. But this won’t help you with issues like storm damage, arson, stolen materials or equipment failures. Once the builder packs up and leaves your home, any workmanship or structural problems that arise later are often not covered either.

Make sure you watch out for home insurance exclusions

If your renovation project exceeds £25,000, most home insurance policies won’t cover it – especially when altering the structure. Don’t make the mistake of assuming either your builder’s insurance or your home insurance will protect your extension project.

So, what insurance do you need?

Here’s what you should look for:

• A-rated insurers. Ensure the policy is backed by reliable insurers.
• Comprehensive coverage. Your policy must cover your entire property during and after construction, including the new works and materials.
• Tool and equipment protection. Make sure tools and equipment left on-site are insured.
• Employers’ and public liability insurance. This protects against injuries to workers or damage to third-party property during construction.
• Legal coverage. Your policy should cover legal costs if you need to defend or pursue claims related to injuries or property damage during the build.

Timing is everything

Site insurance should be secured at least 30 days before work begins and must cover the entire project duration. Additionally, consider a structural warranty to protect against hidden structural defects after the work is completed—a requirement for many lenders in the UK.

Lastly, don’t just take your builder’s word for it.

Ask to see their insurance documents and confirm the coverage matches the scope and cost of your project. Often, builders’ insurance limits are lower than the actual cost of construction, and it may only cover the work they personally perform.

Stay informed, stay protected, and make sure you’ve got the right insurance in place before the first brick is laid!

Other blogs which may be of interest:

Understanding the LEG3 clause in light of Archer v Ace - A must know for construction professionals

Construction: Its time to talk

Get in touch today on 01245 449060 or email Matthew.Collins@ascendbroking.co.uk.