Contract works insurance commences on the later of the date on the policy or when work starts on site. So, if you have bought materials early they may not be covered if work has yet to begin.

With prices rising and supply chains stretched it’s tempting for builders to pre-order the materials they need to get a lower price. Those materials will need to be stored somewhere and are then at risk of being stolen or damaged.

If the materials are for a specific job just arranging contract works insurance early won’t cover them if work hasn’t actually started. The insurer would need to specifically agree to this, which may be tricky if the work isn’t due to begin for weeks or months.

Who owns the materials could affect how best to insure them. For example, if the homeowner owns them (perhaps because they have paid your invoice – your contract would need to be clear on this point) they could look to add them under their contents insurance.

If you own them they could be insured under a material damage policy. If you already have one of these it should be simple to increase the sum insured, perhaps just for the short period of time before the job starts and they fall under the contract works policy. Even a tools/mobile assets policy will generally also cover stock and materials, as long as they are included in the sum insured.

If you don’t have a current policy then you would want to take one out. In either case the insurer will want to know details about how the materials are secured. Are they visible from the road, are they fenced off, if they’re stored in a container what sort of lock does it have?

Lastly, if projects are delayed make sure the contract works insurance is extended. If a claim happens after the end date on the policy you may have no cover.

In a Nutshell

If you’re storing materials in advance of a project starting make sure that they are properly insured.

The information presented in this article is general in nature and not intended to be financial advice for individual situations. You should speak to an expert about your specific circumstances and needs.

Contract Works Insurance