What is contract works insurance?
Contract works insurance covers the physical building or structure being built — including materials on site, partly finished work, and temporary structures like scaffolding — against loss or damage before the project is handed over. It's often bought as a standalone policy on smaller jobs, or as one section of a full contractors all risk policy on larger ones.
- It protects the works themselves, not the contractor's liability to third parties.
- Cover normally runs from the start of works to practical completion, with an optional defects-period extension.
- Materials delivered but not yet installed are usually covered once they're on site.
- It's frequently a condition set by lenders, clients, or main contract terms (e.g. JCT contracts) before work can start.
- Standalone contract works cover is often cheaper than a full CAR policy for single-trade or domestic jobs.
What it actually pays out for
When it starts and ends
Standalone vs. part of a bigger policy
Storm damage to a part-built extension
Scenario: A two-storey rear extension was mid-build when an overnight storm brought down scaffolding and let rain into the newly built brick shell, soaking insulation and timber joists that were already installed.
Resolution & Judicial Outcome: The contractor's standalone contract works policy paid for the scaffolding to be re-erected and the damaged materials and timber to be replaced, allowing the build to restart within two weeks rather than the project stalling on an uninsured loss.
What You Should Do: Step-by-Step Action Plan
Critical Mistakes to Avoid
- Under-insuring by setting the sum insured to the original quote rather than the current, possibly higher, rebuild cost.
- Assuming the client's buildings insurance covers an ongoing extension — most standard home policies exclude works in progress.
- Letting cover lapse at the original completion date on a job that has overrun.
- Forgetting that theft of unfixed materials often has a tighter sub-limit than the main sum insured.