Contract Works & Public & Products Liability Insurance

Construction & Civil

Contract Works & Public & Products Liability Insurance

Insurance Union are specialist insurance brokers to the built environment. With over 20 years of construction insurance broking experience, our team has helped thousands of SME construction businesses arrange their insurance, as well as larger organisations with revenues exceeding $250 million.

We work with businesses across the construction industry including builders, civil contractors and specialist trades to structure insurance that aligns with contractual and operational risks.

Request a Quote

Contract Works Insurance

Contract Works Insurance protects construction works, materials on site, and materials in transit or storage against accidental loss or damage during a project.

It is sometimes referred to as:

Material Damage
Contractors’ All Risks (CAR) when packaged with Public & Products Liability

Most construction contracts require “The Works” to be insured, usually by the head contractor.

In some cases, developers or principals may instead arrange a Principal Controlled Insurance Program (PCIP) to protect the project if a contractor becomes insolvent or the contract is terminated.

Common Contract Works Claims

Typical claims can include:

Fire or hot works incidents
Storm, wind, flood or natural disasters
Theft or malicious damage on site
Damage to partially completed works
Accidental damage caused during construction

Public & Products Liability Insurance

Public & Products Liability Insurance covers claims where your business is alleged to have caused injury to a third party or damage to their property.

Construction sites are complex environments with multiple contractors operating simultaneously, creating significant exposure to liability claims.

Head contractors in particular carry higher exposure due to their responsibility for site safety and coordination of subcontractors.

Key Liability Risks

Common exposures include:

Worker-to-worker injury claims
Fire risks from hot works or welding
Damage caused by plant or equipment
Vicarious liability from subcontractors
Property damage to surrounding structures

Considerations for Trades & Civil Contractors

Trades and civil contractors often assume contractual responsibility for their own works under “back-to-back” subcontract arrangements.

It is important that the activities listed on the policy accurately reflect the work performed. Contractors frequently undertake multiple trades or disciplines, and incomplete descriptions can lead to uninsured exposures.

For example, a contractor performing carpentry, plastering and painting should ensure all activities are disclosed to the insurer.

Principal/Head Contractors Contract Works Insurance

Contract Works Insurance is designed to cover loss or damage to materials on a construction site, including materials in transit/storage. Also referred to as Material Damage or when bought together with Public & Products Liability, the package can also be known as Contractors' All Risks (CAR) Insurance.

Most head contract conditions state, “The Works” are the head contractors responsibility and need to be insured for damage. Although less common, Principal Controlled Insurance can be purchased by owners and developers allowing developers to control the insurance program and protect the project in the event contractor insolvency or contract termination.

Claims examples include natural disasters, such as bushfires, fire, earthquakes, flood and water damage, subsidence and landslip, storm, tsunami or wind. As well as damage to property caused by defects, theft and malicious damage or vandalism.

Trades & Civil Contractors Contract Works Insurance

Contract Works requirements can be passed on via sub-contracts in what’s termed "back to back" contracts. This usually happens on larger contracts or when working for higher tier principal contractors.

Checking whether you are responsible for damage to your own works is recommended as evidence of sub-contractor contract works insurance is not always checked, potentially leaving you on the hook contractually without cover.

Civil contractors may find they are responsible for damage on site during early works. Pipes, dewatering, landslide and road surface repairs or replacement can be costly. We recommend reviewing the insurance clauses in your contract to check who is responsible for damage.

Claims examples include natural disasters, such as bushfires, fire, earthquakes, flood and water damage, subsidence and landslip, storm, tsunami or wind. As well as damage to property caused by defects, theft and malicious damage or vandalism.

Principal/Head Contractors Public & Products Liability

Designed to cover you against claims for injury and/or damage to third parties this is most businesses, most important policy due to the potential legal costs and damages awarded in one of the most litigious countries in the world. Head contractors generally take on more financial, contractual, operational and environmental risks then their appointed contractors and it’s important to make sure your public & products liability insurance aligns as closely as possible with your contractual, operational and environmental risks.

One of the largest risks you and your insurers face is called “Worker to Worker” liability. Most construction sites have large numbers of contractors and sub-contractors on site at any one time, which creates a high-risk environment for third party damage and injury claims. As the head/principal contractor is responsible for the health and safety of workers on site it’s important to have good risk management processes and procedures in place such as; site inductions, work safe methods and accident reports, statements & photographs in the event of injury or damage.

Other significant risks you and your insurers are exposed to include; fire risks from hot work/welding, plant, unauthorised site access and vicarious liability from sub-contractors workmanship and/or defective products or specifications.

Trades & Civil Contractors Public & Products Liability

Similarly to Principal/Head Contractors this policy is designed to cover you against claims for injury and/or damage to third parties.

Whilst there can be similar financial, contractual, operational and environmental risks taken by trades & civil contractors, one of the most significant differences is the activity or activities being undertaken. The head/principal contractor is generally referred to as "The Builder" whereas trades and civil contractors need to specify their business activities and with some contractors carrying out multiple activities, it’s important all are specified in your schedule.

For example, a contractor may work as a Carpenter, Gyprocker, Tiler and Painting Contractor and so should not have a policy that notes “Painter” only, unless all activities have been disclosed to the insurer.

Similarly, civil construction has various disciplines that should be specified. Is the business solely involved in excavation and site preparation or does the business build bridges, work gas & water escape, injury caused by tools & on road and motorway construction, build sea walls and/or flood defence, involved in wet risks, railway, airport or other high-rise hazardous locations or sectors.

If works are sub-contracted there are similar "Worker to Worker" exposures for trades & civil contractors as well as fire risk from hot work/welding, gas & water escape, injury caused by tools & plant.

Request a Quote