Around this time last year, we wrote about the importance of considering renovation insurance cover when carrying out such work on your property. In this blog, we expand on that topic and cover some of the common myths that homeowners often mistakenly believe, and inform you as to why JCT contracts are important when it comes to renovation insurance.
Renovation insurance myths
“My home insurance will cover any damage to my home”
As we mentioned in our previous blog about renovation insurance, “A common misconception is that your home insurance will continue to cover you while you undertake work”, but the reality is that most insurers will exclude any structural work.
Not only this but failing to disclose a building project would be considered a non-disclosure of a material fact by insurers and may mean that a claim would be declined.
Damage is always a high risk when there is renovation work underway. So, even if your insurer did provide you with some form of cover after you’ve informed them of the work, they will most likely exclude any damage caused by the contractor, or because of the work taking place. In our experience, when insurers do offer cover during the works, whilst not covering the works themselves, the cover is limited to damage caused by fire, lightning, earthquake and explosion.
During a renovation job, theft is also a heightened risk and may not be automatically covered by your home contents insurance if you have moved out while the work is being done, regardless of whether your property is occupied by workers all the time or not. There is no guarantee that your insurer would cover your contents even after you have informed them that you will be temporarily staying elsewhere while your possessions remain where they are; this is something you need to discuss with them to get a clear understanding of exactly what you are and are not covered for.
“Any issues will be covered by the builder’s insurance”
Again, as we mentioned, “whilst most contractors will have insurance for the works carried out on your home, it might not protect you in all circumstances”, meaning damage to the property or possessions (caused by burst pipes, fires storms with an open roof, or theft for example) may not be insured.
Damage that isn’t a direct fault of the builder can also occur, (e.g. cracking of walls that join onto the section that is being taken down due to how that area was originally built) and in these circumstances, their insurance may not pay out as the builder has not done anything wrong themselves and could not avoid the damage from occurring. This is just another reason as to why it’s so important to make sure you have renovation insurance in place.
“Renovation insurance is expensive, and nothing will happen anyway”
Insurance is proportionate to the risk that it is covering. The risks involved during a renovation project, which can be compared to a building site, are far greater than those that the average home insurance covers for an occupied domestic home, hence the higher premium.
Problems and incidents do happen during renovations and due to the complex nature of an ongoing programme of works, these can often be costly and lengthy to put right – the last thing you need to be thinking about when you have works underway and may be working to some kind of budget. The last thing any of us want in this situation is for two insurers to be fighting over who is going to pay what.
So now we know how valuable renovation insurance can be, what are JCT contracts and where do they come into play?
What is a JCT contract and how can it help?
The Joint Contracts Tribunal was established in 1931 by the Royal Institute of British Architects (RIBA) and the National Federation of Building Trades Employers (NFBTE). Since its founding, the JCT has formed contracts and guidance notes for use in the construction industry.
A JCT contract is an agreement between two parties – you as the client and your main contractor; this agreement establishes the terms for each party and manages the relationship between them, with the aim of ensuring a smooth delivery of the project at hand.
There are various forms of contracts to suit the different scopes of projects. These include:
- JCT Homeowner – Suitable for small, straightforward projects on anything up to the size of a small rear extension.
- JCT Minor Building Works – Suitable for larger projects but where the works remain relatively straightforward.
- JCT Intermediate – Suitable for larger, more complex projects on any building up to single house builds with complex materials and sub-contractors.
- JCT Standard – Suitable for the largest of domestic projects and large developments.
For the purposes of renovating your home, a JCT contract will outline things such as when the contractual agreement starts and ends, what to do in the event of a dispute or deal with complications on-site, how to calculate the payment for the builder and when, and more.
The majority of contractors have their own agreement or terms and conditions when it comes to a project. Some increase their quotes if the client wants to use a JCT contract, while others have never heard of them before. It’s important to know though, a JCT contract is there to guide and protect both parties mutually and can be invaluable in the event something does go wrong and a claim needs to be made.
McClarrons Affinity can help you with renovation insurance
There are various insurance options and JCT contracts to make your insurance work for you and although we do not profess to be the experts in JCT contracts, we certainly are in insurance and can discuss suitable cover for your renovation project.
If you are planning to carry out works on your property, speak to us about the cover you should be considering first by calling 01653 602634 or by emailing affinity@mcclarroninsurance.com.
