What are the key risks in the building and construction industry?

Construction projects involve multiple stakeholders and are often undertaken on challenging sites. Construction businesses must often manage changes to scope or orders, poorly written contracts and specifications and complex project management issues. They may need to deal with labour and materials shortages, or theft of tools and materials. Subcontractors and suppliers can provide extra stress for construction firms, as can the rising number of extreme weather events. What’s more, cybercrime is an emerging threat to construction businesses, which often use insecure connections from mobile workplaces, and share file and data with stakeholders outside the business.

Who should consider insurance?

Whether you’re an owner builder, a contractor or a large construction company, you’ll need a range of insurance covers to safeguard your workers, building and equipment.

Did you know?

12,600

12,600 – The average number of serious claims per year over the last 5 years.

(Safe Work Australia, Construction Industry Profile, 2015)

The construction industry had the fourth highest rate of serious claims in 2012-13.

(Safe Work Australia, Construction Industry Profile, 2015)

6.4 weeks – The typical number of weeks off work for serious claims in 2011-12.

(Safe Work Australia, Construction Industry Profile, 2015)

What insurance should you take out – and what can it cover?

Insurance can protect you and your employees onsite, on the way to work and in your office

Type of cover Potential benefits
Contract works Protects any buildings under construction and construction equipment. This cover
may include protection against:

  • natural disasters like fire, earthquake, storm, flood, wind and water damage
  • damage to property caused by defects, theft and malicious damage or vandalism or smashed glass
  • third-party personal injury and property damage.
Business pack Safeguards your business premises against:

  • equipment or machinery breakdown
  • employee dishonesty
  • property or glass damage
  • legal issues, with public and products liability
  • tax audit
  • theft, and theft or loss of money.
Cyber Safeguards you and your business against expenses and legal costs if your website or
other systems are hacked and your system cannot be used or customers’ details are
stolen.
Motor insurance Takes care of your valuable business vehicles with cover to:

  • help if you or your staff damage another person’s vehicle
  • repair your vehicle after an accident or replace it if it’s written off
  • replace a lost or stolen vehicle
  • safeguard you against legal liability.
Professional Indemnity Protects you against legal action from a client for breach of professional duty. This
type of insurance is often required by building contracts.
Workers Compensation Covers the cost of your employees’ wages, rehabilitation and medication if they
become injured or sick through their work.

What usually isn’t
covered?

Exclusions, the excess you need to pay and limits of liability can vary greatly depending on your insurer and the requirements of your business.

Case Study

Rick has a small construction business, which employs subcontractors from time to time. As his usual plumber was unavailable for a job renovating a home, Rick employed a plumber recommended from a friend. Unfortunately, the plumber did a careless job and a pipe burst overnight, flooding the building and causing extensive damage to the half-completed renovations. Rick successfully claimed on his contract works, which covered the cost of the labour and materials to rectify the damage.

CONTACT MORGAN INSURANCE

Address: 75 Redfern St, Cowra NSW 2794
Phone: 02 6342 4861
Freecall: 1300 915 024
Email: enquiry@morganinsurance.com.au

ABN 22 166 392 516 | AR 452128
Authorised Representative of PSC Connect Pty Ltd
AFSL 344648 | ABN 23 141 574 914

Morgan Insurance Group endorses the Insurance Brokers Code of Practice. To obtain a copy of the code, click here.

Contact Morgan Insurance today on 1300 915 024.

Morgan Insurance