Renovation and Refurbishment Contractors Insurance
Refurbishment is priced and insured differently from new build for one reason: there is already a building there, somebody owns it, and quite often somebody is still using it. Every risk that makes new build straightforward, an empty site, a clean slate, a known structure, is reversed. You are working inside somebody else's asset, around their tenants, with services and structures nobody has fully documented since the 1970s.
The claims reflect that. Escape of water into finished floors below, fire from hot works in a building with live occupants, damage to a structure that turned out to be load bearing, and asbestos disturbed in a ceiling void that no survey covered. These are not exotic scenarios; they are the standard loss pattern for this trade, and they are exactly the areas where a general builders policy is thinnest.
We arrange cover for refurbishment and fit out contractors working in occupied commercial premises, residential blocks and period property, and the important part is usually settling who insures the existing structure before the first tool comes out of the van.
What actually goes wrong
The exposures that produce claims in this trade, rather than a generic list.
The existing structure
The building you are refurbishing is not third party property in the ordinary sense; it is property in your care, custody or control, and standard public liability excludes it. If your work damages the building itself, cover has to come either from an existing structures extension on your policy or from the employer's own insurance with your interest noted. On amended contracts this responsibility moves around, and it is the most common uninsured loss in the trade.
Occupied buildings
Working around tenants, staff or residents multiplies the liability exposure and constrains how you work. Dust, noise and access restrictions push work into evenings and weekends, and out of hours working is when alarm systems get isolated, fire doors get wedged and sprinklers get capped. Insurers care about all three.
Escape of water
The most frequent large loss in refurbishment. Capping a live main incorrectly, disturbing a hidden pipe run above a suspended ceiling, or leaving a system pressurised over a weekend can flood several floors of finished work below. Damage to floors you have already handed over, and to a tenant's contents and stock, are different heads of claim that need different sections of cover.
Asbestos in pre 2000 buildings
Any building constructed or refurbished before 2000 may contain asbestos, and refurbishment is the activity most likely to disturb it. A refurbishment and demolition survey is a legal expectation before intrusive work. Disturbance without one creates a liability exposure, a remediation cost and an enforcement risk, and most policies exclude the asbestos element of all three.
Structural surprises
Opening up an old building reveals what the drawings did not. Walls that were assumed non load bearing, beams bearing on nothing much, and previous alterations done without approval. The cost of dealing with what you find is a contractual matter, but a partial collapse while you deal with it is an insurance one.
The cover we arrange
Policies are put together around how you work. Employers liability is included as standard wherever you employ anyone.
Public liability
Third party injury and property damage arising from your work. In occupied premises the third parties include tenants, their customers and their stock, so limits are usually set higher than for equivalent domestic work. £5m is the practical minimum for commercial refurbishment.
- Injury to occupants, tenants and visitors
- Damage to tenant property and stock
- Legal defence costs
- Limits typically £5m or £10m
Existing structures cover
Extends cover to the building you are working on, which public liability excludes. Needed whenever the contract puts responsibility for the existing structure on you rather than the employer, and worth checking on every contract rather than assuming it follows the last one.
- The building being refurbished
- Arranged where the contract requires it
- Sum insured on a reinstatement basis
- Employer's interest noted where needed
Contract works
Covers your works in progress: materials on site, completed sections not yet handed over and temporary works. On phased handovers the sum insured needs to reflect that sections already handed over may no longer be yours to insure, which is easy to get wrong in both directions.
- Work in progress and materials
- Completed but unhandled sections
- Temporary works and protection
- Phased handover arrangements
Employers liability
Legally required and included as standard at £10m. Refurbishment carries a higher proportion of labour only subcontractors than new build, and all of them normally count as employees for this purpose.
- Legally required, £10m as standard
- Labour only subcontractors included
- Occupational illness including dust exposure
- Legal representation at inquest and enquiry
Plant, tools and equipment
Covers owned and hired plant, access equipment and hand tools. In occupied buildings tools are frequently left on site between shifts rather than returned to a van, so the site storage conditions in the policy matter more than usual.
- Owned and hired in plant
- Access equipment and towers
- Tools left on site overnight
- Theft, fire and accidental damage
What an underwriter will ask
Having these to hand shortens the process considerably, and usually improves the terms.
- Turnover split between occupied and unoccupied buildings
- Types of building: residential blocks, commercial offices, retail, period or listed property
- Whether you work in premises that remain trading during the works
- The age of the buildings you typically work on, and your asbestos procedures
- Whether any structural alteration, underpinning or facade retention is involved
- Hot works procedures and whether a permit system is operated
- Out of hours and weekend working, and how alarms and sprinklers are managed
- Largest contract value taken and planned
- Five years of claims, including water damage incidents that were settled directly
What moves the premium
Where the price actually comes from, and which parts of it you can change.
Occupied or empty
Working in a trading building is the single biggest rating factor in this class. It raises the liability exposure, the water damage exposure and the consequential loss potential all at once.
Building age and type
Period and listed property carries higher reinstatement costs and more restrictive repair requirements. Post war commercial stock carries asbestos and unknown service runs. Both affect terms, in different ways.
Hot works and out of hours procedures
A documented permit system and a clear policy on alarm and sprinkler isolation are among the few operational details that reliably improve terms on this class, because they address the two largest loss types directly.
Contract values and phasing
Large phased contracts in occupied premises price differently from a series of small empty property refurbishments, even at identical turnover.
Water damage history
Escape of water claims are frequent and expensive in refurbishment, and a history of them is priced hard. Firms that can evidence pressure testing and isolation procedures present much better.
Conditions and exclusions that catch this trade out
Terms vary between insurers, so treat these as the questions to ask rather than a description of any one policy.
Property in your care, custody or control
The standard exclusion that catches this trade. The building you are working on, and often the contents of the room you are working in, fall outside public liability because they are in your control. Existing structures cover exists precisely to fill it, and without that extension the largest foreseeable loss is uninsured.
Hot works without a permit
Refurbishment involves soldering, grinding and hot air stripping in buildings full of combustible material and often full of people. Expect a condition requiring a written permit, clearance or protection of combustibles, extinguishers to hand and a sixty minute fire watch after work stops. Breach of it in a fire claim is normally fatal to the claim.
Asbestos
Excluded on most wordings, covering both liability for exposure and the cost of removal or remediation. Where you work on pre 2000 buildings, the practical protection is procedural: insist on a refurbishment and demolition survey, and stop work on discovery.
Damage to services
Striking a hidden cable, pipe or drain is common in refurbishment and many wordings restrict cover unless the position was checked using an appropriate method beforehand. Records of scanning and of drawings obtained are what turn a disputed claim into a paid one.
Existing defects
You are not insured for the pre existing condition of the building. If a roof was already failing, your policy will not fund the roof. What it covers is damage arising from your work, which is why condition surveys and photographic records before starting are worth the hour they take.
Common questions
Who insures the building during a refurbishment contract?
It depends on the contract. Under standard building contract insurance options, work to an existing building is usually insured by the employer, covering both the existing structure and the works, with the contractor's interest noted. Where the contract is amended, or where you are working for a client without their own cover in place, that responsibility can fall on you and needs an existing structures extension. Settle it in writing before starting, because after a fire is the worst time to discover neither party arranged it.
Does public liability cover damage to the building I am refurbishing?
No, not on a standard policy. Public liability covers third party property, and the building you are contracted to work on is treated as property in your care, custody or control, which is a standard exclusion. Damage to it needs either an existing structures extension on your own policy or cover arranged by the building owner. This is the most common uninsured loss in refurbishment work.
What insurance do I need to work in an occupied building?
The same core covers, but with the limits and conditions set for a much larger exposure. Public liability at £5m or £10m rather than £1m or £2m, because tenants, their customers and their stock are all in the building. Existing structures cover where the contract requires it. And realistic attention to the conditions attaching to hot works, alarm isolation and out of hours access, since those are what claims turn on.
Is asbestos covered by refurbishment contractors insurance?
Generally not. Most policies exclude asbestos entirely, for liability arising from exposure and for the cost of removal or making good. Any building built or refurbished before 2000 may contain it, and the law expects a refurbishment and demolition survey before intrusive work. The practical protection is procedural rather than insurance based: obtain the survey, stop on discovery, and use a licensed contractor for licensed work.
What happens if I flood the floors below the one I am working on?
Several different sections respond, which is why the detail matters. Damage to another occupier's premises and contents is a public liability claim. Damage to parts of your own works already completed is contract works. Damage to the existing structure is either existing structures cover or the employer's policy. A tenant's loss of trade while the space dries out is a consequential loss claim against you. Escape of water is the most frequent large loss in refurbishment precisely because it crosses so many boundaries at once.
Do I need different insurance for listed buildings?
Not a different type, but different sums insured and different conditions. Reinstatement of a listed building must match original materials and methods, so the cost of putting right damage is far higher than for equivalent modern construction. Insurers will want to know the listing grade and the nature of the work, and are more likely to apply conditions around hot works, since fire in a listed structure is effectively unrecoverable.
Talk to somebody who knows the trade
Tell us what you actually do and we will come back to you with cover options built around it.