JCT 98 Contract Insurances - Revision history

Designing Buildings at 09:16, 27 October 2020

2020-10-27T09:16:31Z

← Older revision		Revision as of 09:16, 27 October 2020
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	* this liability can be covered by a Contractor's Design and Construct PI policy		* this liability can be covered by a Contractor's Design and Construct PI policy
	* ensure that the design and build contractor carries PI cover as Clause 22 imposes no requirement		* ensure that the design and build contractor carries PI cover as Clause 22 imposes no requirement
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−

	== CONTRACT WORKS INSURANCE POLICY ==		== CONTRACT WORKS INSURANCE POLICY ==
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	* insurance to be arranged in the name of the employer to protect him in respect of his legal liability for damage to adjacent or surrounding property which is caused other than by the negligence of the contractor or his sub-contractors (employer already protected against negligence under clause 20.2)		* insurance to be arranged in the name of the employer to protect him in respect of his legal liability for damage to adjacent or surrounding property which is caused other than by the negligence of the contractor or his sub-contractors (employer already protected against negligence under clause 20.2)
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−

	== LATENT DEFECTS (DECENNIAL) INSURANCE ==		== LATENT DEFECTS (DECENNIAL) INSURANCE ==
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	* basis of cover (full value or first loss)		* basis of cover (full value or first loss)

−	[[Category:Articles_needing_more_work]]	+	[[Category:Articles_needing_more_work]] [[Category:DCN_Guidance]]

60.242.68.136 at 18:41, 30 June 2017

2017-06-30T18:41:31Z

Show changes

Designing Buildings at 12:55, 25 July 2014

2014-07-25T12:55:54Z

← Older revision		Revision as of 12:55, 25 July 2014
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		+
		+	To help develop this article, click 'Edit this article' above.

	= JCT 98 =		= JCT 98 =
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	== Clause 20 - Injury to persons and property and indemnity to employer ==		== Clause 20 - Injury to persons and property and indemnity to employer ==
−	*contractor to indemnify the employer for	+	*contractor to indemnify the employer for any expense, liability, loss, claims or proceedings arising by virtue of statute or common law in respect of death or personal injury caused by the carrying out of the works except as a result of negligence of the employer or of any person for whom the employer is responsible <br/>
−	*any expense, liability, loss, claims or proceedings	+	*duty to indemnify the employer also covers damage to property (property owned by third parties, parts of contract works for which certificate of practical completion has been issued, and exiting property owned by the employer) but only when damage was due to negligence, breach of statutory duty, omission or default by the contractor, or those for whom he is responsible
−	*arising by virtue of statute or common law	+
−	*in respect of death or personal injury caused by the carrying out of the works	+
−	*except as a result of negligence of the employer	+
−	*or of any person for whom the employer is responsible	+
−	*duty to indemnify the employer also covers damage to property (property owned by third parties, parts of contract works for which certificate of practical completion has been issued, and exiting property owned by the employer)	+
−	*but only when damage was due to negligence, breach of statutory duty, omission or default by the contractor, or those for whom he is responsible	+
	*not caused by specific perils (fire, lightening, explosion, storm, tempest, flood, burst pipes, earthquake, aircraft and riot)		*not caused by specific perils (fire, lightening, explosion, storm, tempest, flood, burst pipes, earthquake, aircraft and riot)
	*contractor can recover from any third party at fault		*contractor can recover from any third party at fault
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	Requirement		Requirement
−	*contractor to take out and maintain a joint names policy for all risks insurance	+	*contractor to take out and maintain a joint names policy for all risks insurance providing cover against physical loss or damage to work executed and site materials
−	*providing cover against physical loss or damage to work executed and site materials	+

	Exclusions		Exclusions
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	Payment of insurance proceeds		Payment of insurance proceeds
	*contractor authorises the insurers to pay all insurance proceeds to employer		*contractor authorises the insurers to pay all insurance proceeds to employer
−	*employer has to pay monies (less professional fees) to the contractor by ~~instalments~~	+	*employer has to pay monies (less professional fees) to the contractor by installments
	*issued under architects' certificates at interim certificate periods		*issued under architects' certificates at interim certificate periods

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	== Clause 21.2.1 ==		== Clause 21.2.1 ==
−	*insurance to be arranged in the name of the employer	+	*insurance to be arranged in the name of the employer to protect him in respect of his legal liability for damage to adjacent or surrounding property which is caused other than by the negligence of the contractor or his sub-contractors (employer already protected against negligence under clause 20.2)
−	*to protect him in respect of his legal liability for damage to adjacent or surrounding property	+
−	*which is caused other than by the negligence of the contractor or his sub-contractors (employer already protected against negligence under clause 20.2)	+

	<br/>		<br/>
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	== General ==		== General ==
−	*ten-year non-cancellable policy	+	*ten-year non-cancellable policy to indemnify the insured against the cost of repairing defects in the design, material or construction of the building which were not discovered until after the building had been completed
−	*to indemnify the insured against the cost of repairing defects in the design, material or construction of the building which were not discovered until after the building had been completed	+
	*once a building passes to the owner, he insures it under a fire and perils policy		*once a building passes to the owner, he insures it under a fire and perils policy
	*the cost of rectifying latent defects is not covered by a fire and perils policy		*the cost of rectifying latent defects is not covered by a fire and perils policy
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	*amount of excess and indexation		*amount of excess and indexation
	*basis of cover (full value or first loss)		*basis of cover (full value or first loss)
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		+	[[Category:Articles_needing_more_work]]

Designing Buildings: moved Contract Insurances to JCT 98 Contract Insurances

2014-07-25T12:51:16Z

moved Contract Insurances to JCT 98 Contract Insurances

← Older revision

Revision as of 12:51, 25 July 2014

Designing Buildings at 12:50, 25 July 2014

2014-07-25T12:50:55Z

← Older revision		Revision as of 12:50, 25 July 2014
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−		+	= JCT 98 =
−	= ~~CONTRACT INSURANCES~~ =	+

	== Relevant Provisions in Main Contract ==		== Relevant Provisions in Main Contract ==
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	*required to carry and maintain insurance to cover its liabilities in respect of personal injury or death ensuing from work carried out by it		*required to carry and maintain insurance to cover its liabilities in respect of personal injury or death ensuing from work carried out by it

−	~~<br/>~~	+	= CONTRACT INSURANCE UNDER JCT 98 WITH CONTRACTOR'S DESIGN =
−	== CONTRACT INSURANCE UNDER JCT 98 WITH CONTRACTOR'S DESIGN ==	+

	== General ==		== General ==
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	<br/>		<br/>
		+
	== CONTRACT WORKS INSURANCE POLICY ==		== CONTRACT WORKS INSURANCE POLICY ==

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	<br/>		<br/>
		+
	== LATENT DEFECTS (DECENNIAL) INSURANCE ==		== LATENT DEFECTS (DECENNIAL) INSURANCE ==

Xela: Created page with " = CONTRACT INSURANCES = == Relevant Provisions in Main Contract == Clause 20 - Injury to persons and property and indemnity to employer Clause 21 - Insurance against injury ..."

2014-01-05T07:39:17Z

Created page with " = CONTRACT INSURANCES = == Relevant Provisions in Main Contract == *Clause 20 - Injury to persons and property and indemnity to employer *Clause 21 - Insurance against injury ..."

New page

= CONTRACT INSURANCES =

== Relevant Provisions in Main Contract ==
*Clause 20 - Injury to persons and property and indemnity to employer
*Clause 21 - Insurance against injury to persons and property
*Clause 22 - Insurance of the works
*Clause 22A - Erection of new buildings - all risks insurance of the works by the contractor
*Clause 22B - Erection of new buildings - all risks insurance of the works by the employer
*Clause 22C - Insurance of existing structures - works in or extensions to existing structures
*Clause 22D - Insurance for employer's loss of liquidated damages
*Clause 22FC - Joint Fire Code compliance

== Clause 20 - Injury to persons and property and indemnity to employer ==
*contractor to indemnify the employer for
*any expense, liability, loss, claims or proceedings
*arising by virtue of statute or common law
*in respect of death or personal injury caused by the carrying out of the works
*except as a result of negligence of the employer
*or of any person for whom the employer is responsible
*duty to indemnify the employer also covers damage to property (property owned by third parties, parts of contract works for which certificate of practical completion has been issued, and exiting property owned by the employer)
*but only when damage was due to negligence, breach of statutory duty, omission or default by the contractor, or those for whom he is responsible
*not caused by specific perils (fire, lightening, explosion, storm, tempest, flood, burst pipes, earthquake, aircraft and riot)
*contractor can recover from any third party at fault

== Clause 21 - Insurance against injury to persons and property ==
*insurance to be taken out and maintained by the contractor for indemnities given under Clause 20 to the employer
*contractor does not take responsibility for a sub-contractor maintaining its insurance, but will need to ensure that the sub-contractor carries such a policy under the relevant sub-contract
*contract administrator can instruct the contractor to take out and maintain an additional joint names policy to indemnify the employer both against strict liability to third parties and against any damage caused to the employer's own property resulting from collapse, subsidence, heave, vibration, withdrawal of support, lowering or ground water etc.

== Clause 22 - Insurance of the works ==
*insurance to remain in force until the issue of certificate of practical completion or determination of the contractor's employment

== Clause 22A - Erection of new buildings - all risks insurance of the works by the contractor ==

Requirement
*contractor to take out and maintain a joint names policy for all risks insurance
*providing cover against physical loss or damage to work executed and site materials

Exclusions
*damage to property arising from wear and tear, obsolescence, deterioration
*work carried out as a result of design defects
*professional negligence risk - insured separately
*fitness for purpose risk

Failure of contractor to take out policy
*employer can take out his own policy and set off the costs against monies due to the contractor

Payment of insurance proceeds
*contractor authorises the insurers to pay all insurance proceeds to employer
*employer has to pay monies (less professional fees) to the contractor by instalments
*issued under architects' certificates at interim certificate periods

Partial completion
*employer takes responsibility of the works taken back

Site materials
*all unfixed and goods delivered to, placed on, or adjacent to the works and intended for incorporation in them

== Clause 22B - Erection of new buildings - all risks insurance of the works by the employer ==

Requirement
*employer to take out and maintain a joint names policy for all risks insurance
*providing cover against physical loss or damage to work executed and site materials

Exclusions
*as above

Failure of employer to take out policy
*contractor can take out his own policy and increase the contract sum by the amount of premiums he has to pay.

Payment of insurance proceeds
*no requirement
*restoration of any loss or damage is treated as a variation

== Clause 22C - Insurance of existing structures - insurance of works in or extensions to existing structures ==
*for contract works, employer to take out a joint names policy and protect all sub-contractors
*for existing structures, employer to only insure against specific perils
*insure existing structures and their contents if owned by him, or for which he is responsible

== Clause 22D - Insurance for employer's loss of liquidated damages ==
*employer to inform the contractor whether he should obtain a quote to insure the employer's potential loss of liquidated damages
*only in respect of damage by an specific peril - contractor will be entitled to extension of time, but employer will not be able to claim liquidated damages

== Clause 22FC - Joint Fire Code compliance ==
*employer and contractor to comply with the Joint Code of Practice on the Protection from fire of Construction Sites and Buildings Undergoing Renovation if stated in the appendix
*contractors obliged to rectify breaches of the code if drawn to their attention by the contract works insurer
*contractors liable to the employer if a breach causes damage to the works

== Sub-Contractors ==
*required to observe, perform and comply with the provisions or the main contract
*indemnify the contractor against breaches by them of specific provisions in the main contract
*required to carry and maintain insurance to cover its liabilities in respect of personal injury or death ensuing from work carried out by it

<br/>
== CONTRACT INSURANCE UNDER JCT 98 WITH CONTRACTOR'S DESIGN ==

== General ==
*contractor to carry out not only duties and obligations of a building contractor, but also obligations as a designer

== Contract Works Insurance ==
*similar to JCT 98

== Professional Indemnity Insurance: Design and Construct ==
*under clause 2.5.1 , the liability of the contractor as a designer is limited to the liability of an architect (reasonable skill and care, not fit for purpose)
*this liability can be covered by a Contractor's Design and Construct PI policy
*ensure that the design and build contractor carries PI cover as Clause 22 imposes no requirement

<br/>
== CONTRACT WORKS INSURANCE POLICY ==

== Damage to Works ==
*the indemnity may be the repair, reinstatement or replacement of any property lost or damaged, or a monetary payment of the same amount
*the insured will be the employer and the main contractor, and possible sub-contractors
*loss or damage are covered, subject to a number of exceptions
*the property insured is described in the policy schedule
*the loss or damage must occur during the currency of the policy
*the cover only applies to the contract site

== Cover ==
*usually arranged on an annual basis by a contractor, thus covering all contracts
*possible for cover to be arrange on a single contract basis but more expensive

== Extensions to the policy ==

Transit
*anywhere within the territorial limits
*excludes sea and air transit (heavier risk)
*excludes motor vehicles (insures under motor vehicle policy)
*excludes employees tools (too many small claims)

Principals
*means the employer to comply with the contract condition that the policy should be in joint names

Architects', Surveyors' and Consulting Engineers' fees
*incurred in the reinstatement of the property insured consequent on its loss or damage

Removal of debris
*removing debris
*transportation to dumping ground
*dismantling or demolishing
*shoring up or propping of the portions or property lost or damaged

Off-site storage
*materials and goods whilst not on the site but intended for inclusion in any contract works covered by the policy

== Exceptions to the policy ==

Excess
*means of encouraging the contractor to take care and of
*eliminating small claims

Post-completion risks
*contract works policy to cover risks of loss or damage during construction: once contract completed, risk of damage passes over to employer
*cover ceases at practical completion, except to the extent that it is necessary to cover the contractor's liability under the defect liability clause

Existing Structure
*contract works policy to cover risks of loss or damage to contract works, but not to employer's existing property
*if the employer's existing property is damaged then the employer will only have legal redress against the contractor if he can prove negligence
*the employer may have already insured the risk under existing insurance arrangements
*or may effect special cover under clause21.2.1 against the specific risks of collapse, subsidence, vibration, weakening or removal of support, or lowering of ground water

Other exceptions
*motor vehicles, vessels and crafts
*breakdown and explosion of construction plant
*trade risks: defective materials or workmanship, normal wear and tear
*professional negligence risks: design defects
*confiscation by government
*losses due to unexplained disappearances
*contract penalties for delay, non-completion or consequential loss or damage
*cessation of work: failure to take precautions to protect the property
*testing and commissioning

== General Conditions ==
*reasonable precautions
*disclosure of material facts
*adjustment of the premium
*contribution - if there is another policy, the policy will not pay until the first policy has been exhausted
*cancellation - insurer's, but not the insured, have the right to cancel

== Claims Conditions ==
*notify insurer within three months of any events that may give rise to a claim
*refrain from repairs until the insurer has had time to inspect
*notify and assist the police in case of theft, loss or wilful damage to property

== CLAIMS ==
*dealt with by loss adjusters

== OTHER LIABILITIES ==

== Employers and Public ==
*Contractors' Liability Insurance covers Employer's Liability, Public Liability, Product Liability or Completed Works cover in respect of injury to third parties or damage to their property, as required by JCT 98
*Excludes Professional Liabilities (covered elsewhere)

== Clause 21.2.1 ==
*insurance to be arranged in the name of the employer
*to protect him in respect of his legal liability for damage to adjacent or surrounding property
*which is caused other than by the negligence of the contractor or his sub-contractors (employer already protected against negligence under clause 20.2)

<br/>
== LATENT DEFECTS (DECENNIAL) INSURANCE ==

== General ==
*ten-year non-cancellable policy
*to indemnify the insured against the cost of repairing defects in the design, material or construction of the building which were not discovered until after the building had been completed
*once a building passes to the owner, he insures it under a fire and perils policy
*the cost of rectifying latent defects is not covered by a fire and perils policy
*underwriters will only accept risk if satisfied by design - technical control undertaken by specialists, who issue a certificate of (qualified) acceptance

== The Insured ==
*any person who acquires the freehold or leasehold interest in the premises during the period of insurance therefore subsequent owners/tenants can be insured

== What the policy covers ==

Inherent defects
*if there is no physical damage but an inherent defect in the structure is threatening its stability the policy will cover the cost
*damage to premises caused by subsidence, heave or slip of land is not covered unless it arises from an inherent defect in the foundations
*discovery of an inherent defect does not in itself constitute a claim since there must be damage or threat of collapse

Policy exceptions
*damage arising from fire and the perils normally insurable under a fire policy
*damage arising from alterations, modifications or additions during the period of insurance
*damage caused by or contributed to by inadequate maintenance
*damage exceeded from any process for which the building was not designed
*faulty or inadequate weatherproofing unless requested at the outset

== Period of Insurance ==
*ten-year policy starts from the date of practical completion
*but issued at the start of construction to enable compliance with Technical Control
*policy contains no cancellation cause

Maintenance Period
*contract works policy is extended to give cover during the maintenance (defects liability) period
*risk of duplication of cover during that period
*if during that period damage occurs that is covered by both policies, decennial policy will only pay in excess of the amount payable under contract works policy

== Sum Insured ==
*a full value sum is total estimated cost of re-building the premises, including provision for professional fees and removal of debris
*a first loss sum is lower that the full value when the risk of a total loss may be low

== Premium affected by: ==
*type of building and intended usage
*design and type of construction
*foundations and site (soil) conditions
*project location
*amount of excess and indexation
*basis of cover (full value or first loss)