How insurance requirements of a JCT Contract interact with renovation insurance

jct and renovation insurance

When managing a renovation project of any size it is critical to ensure that the correct insurance clauses under the JCT contract are utilised so that they dovetail with the insurance package which is purchased.

Most other insurance packages which cover renovation projects are not able to meet the specific requirements of a JCT contract. The reason for this is that most JCT contracts require that the contractor is jointly insured under the buildings insurance, and this is normally a problem for insurers. Standard insurers will not be able to cover a project with this requirement as they give up their ability recover claim costs from a negligent contractor.

At Renovation Insurance Brokers our cover is designed to be fully compliant with the JCT suite of contracts. We can offer you the advice you need to ensure that your insurance package dovetails with the insurance requirements of your JCT contract.

As mentioned above, each JCT contract deals with insurance differently, here is a guide to each kind and the insurance considerations that should be made:

Types of JCT contracts and renovation insurance

There are 4 types of JCT contract. Each deals with the insurance issue slightly differently.

JCT Homeowner

The insurance requirements under the JCT Homeowner contract need to be completely replaced to allow the renovator to use our comprehensive, peace of mind solution.

The standard insurance clause states that the renovator insures the building and the contractor insures the works. The effect of this is that only limited cover for the building will be achieved and the renovator will be relying on insurance held by the contractor without having any control over its quality or effectiveness. Our renovation insurance can cover both the building and the works on an ‘all risks’ basis and without the need to rely on anyone else’s insurance.

JCT Minor Building Works

The Minor Building Works JCT offers two options:

  • Option 1 states that the renovator insures the building and the contractor insures the works
  • Option 2 states that the renovator insures both the building and the works and enables the renovator to purchase a bespoke, peace of mind product which offers the widest possible cover and full control.

JCT Intermediate and Standard

Projects using the intermediate and standard JCT contracts are designed to cover larger, more complex projects. There are 3 insurance clauses, A, B & C.

  • Clauses A & B relate to new build projects. One specifies that the developer or owner insures the build and the other specifies that the contractor insures the build.
  • Clause C relates to projects where there is already a structure in existence (renovation/refurbishment/extension) and specifies that the property owner insures both the building and the works in the joint names of the renovator and the contractor.

We have designed our insurance to dovetail with the insurance requirements of the JCT contract, whatever the complexity of the project.

What are the advantages of this approach?

  • The renovator retains full control of the insurance package
  • The widest cover possible for both the building and the works is achieved
  • There is only one insurer involved, avoiding time consuming and frustrating disputes between insurers as to who is responsible for dealing with a loss

Find out more about JCT contracts

Do you need help with understanding JCT contracts? Read our guide to JCT contracts or visit the JCT Contract section in our Knowledge Base.
For more advice on the right insurance for your client’s project get in touch with our team who will be happy to advise you.

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