The insurer should be notified about construction work and repairs[Dagmar Gilden | 13.07]
Summer is a popular time for construction work, but homeowners are often unaware that they should also notify their insurer about the risk filled endeavour, if only to make sure that all damages would be subject to compensation in the event of an accident.
According to Dagmar Gilden, Asset Insurance Product Manager at Seesam, before getting started on more extensive construction work or repairs one should consult with their insurer and review the terms and conditions of their Home Insurance contract. Namely, limited insurance cover may be valid during construction work or repairs, a higher deductible may apply and, if the insurer has not been notified about the construction work and an injury occurs due to construction, the insurance undertaking may also refuse to pay compensation.
‘In general, insurance undertakings differentiate between construction work and repairs. Construction work is the execution, expansion and reconstruction (for example, roof replacement) of structures, and the alteration of utility systems (for example piping and electrical systems). Repairs are considered to be wallpapering, painting and the replacement of flooring. The insurance undertaking should definitely be notified about large-scale construction work, in order to determine whether it would be possible to continue with regular Home Insurance or if Construction and Installation Work Insurance is needed,’ stressed Gilden.
Construction work attracts thieves, brings water leaks and fires
According to the insurer, fires occur most often during the course of construction work, while leaks frequently occur during the connecting of pipes, and when part of a building is being demolished, the entire building may suffer damage. Buildings that are under construction attract experienced thieves, since the valuable construction material and tools stored within can be sold at a favourable price on the so-called secondary market. There are also instances of construction material theft, although these fall under Home Insurance only if they are located inside the building.
‘At Seesam, the average Home Insurance loss amount resulting from construction works reaches a few thousand euros. The biggest loss last year was theft from a construction site, the consequences of which resulted in a loss of EUR 20,000,’ noted Gilden.
Even though you don’t have to inform your insurer about smaller repairs, Seesam’s representative also suggests exercising caution in the case of such work. Particular attention should be paid to drilling, especially if you aren't sure where the piping and the electrical system are located. For example, when boring holes in an apartment wall, it is relatively simple to damage your neighbours residence. The beautiful weather of summer also fosters the oiling of floors – flax oil, for example, is highly flammable, and what at first appears to be rather innocuous work has resulted in several fires.
‘With the arrival of the summer construction work season, people also express an interest in accidents caused by construction waste and the compensation thereof. Compensation for incidents of this type can only be demanded from the builder, since insurance does not cover damages which are the result of substandard design work, construction work, repairs or maintenance works, a defective product or defective material. The exception is pipe leaks and fire.'
According to the insurer, it pays to remember some tips in order to ensure a safe construction work and repair season:
- In the case of construction work and repairs, start by preparing the project and applying for building permits. This will help you to think through all of the necessary steps and will thereby reduce the threat of possible damages.
- Notify your insurance undertaking about planned construction work.
- Large scale construction work, such as roof replacement and changes to apartment or building planning, should be entrusted to a construction company, which will ensure the safe performance of the work. The builder should also be asked about whether they have insurance for the period of construction.
- The work techniques employed may not cause injuries to the performers of the work or to third parties. For example, construction waste generated during work may not be thrown out of a window; instead, it must be carefully thrown into a container placed below the window. By acting carelessly the waste may miss the containers and injure passers-by as well as damaging cars parked in close proximity.
- If the use of a small loader, hoist or excavator is required for digging, it pays to rent one along with a driver. The quality of work of a driver that lacks the corresponding training may be worse; more time may be required to perform the work; and while manoeuvring on the object damage may be caused to parked cars, buildings or other assets.
- A large number of accidents are associated with falls from ladders, which is why one must stand upright on the ladder or use safety equipment. Attempting to increase one's working area by leaning may result in a loss of balance, and falling in that case is certain.
- When drilling, one must make sure to avoid electrical wiring or pipes hidden inside of walls or under floors. Drilling into a pipe may create additional water damage, but the result of drilling into electrical wiring may be even harsher.