JCT 6.5 1 Insurance Cover

Understanding JCT Insurance

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Understanding JCT insurance

Standing for Joint Contractors Tribunal, JCT insurance is also known as Non-Negligence insurance or 6.5.1 insurance, and it covers you against claims arising from any damage or loss to neighbouring properties where no negligence can be proven. Put simply, if damage occurs as a result of your works and neither you nor your contractor have done anything wrong, you as the property owner are protected from being sued for the cost of the repair.

For example, if the house next to yours collapses or subsides as a result of the works being carried out on your home and your contractor is not found to have made any mistakes, you are liable to pay up for the damage – which can be expensive.

Whether you need JCT insurance will depend on your property type and the type of works you’re carrying out. You may have signed a party wall agreement with a neighbour which requires you to have this insurance extension. Your contractor will be able to advise you before your project starts if this is necessary, but it’s always important to check with them if you’re unsure.

What JCT insurance covers

JCT insurance provides cover for damage to the neighbouring property where negligence cannot be proven, and it’s an extension of Public Liability insurance. While Public Liability covers events where an act of negligence has caused the damage, JCT insurance goes further and covers damage caused where there are no negligent acts, for example if major groundworks caused cracking in a neighbouring property.

The types of perils we cover as part of our Non-Negligence extension include subsidence, heave, collapse, vibrations or weakening/removal of support, and the lowering of ground water upon the contract works being carried out.

As a condition of our policy wording, we also ask that all contractors have at least £2m Public Liability cover in case they are liable for a loss which falls under their Public Liability policy. If the neighbouring property has a rebuild value higher than £2m then the contractor will need to increase their cover.

What projects need JCT insurance cover?

As a rule, the projects that need this type of cover include semi-detached or terraced properties that are undergoing major groundworks, or works on a party wall, such as a basement works, underpinning or piling. If a party wall agreement is issued, this makes you financially liable for damage to the neighbouring property, so Non-Negligence insurance is an important cover for you to consider.

JCT insurance options

JCT insurance is normally stipulated within your JCT contract. This is a type of contract that’s often drawn up for specific one-off building projects and you can buy it directly from the JCT.

JCT contracts are designed to clarify all aspects of the project and avoid potential disputes over who was at fault in the event of a problem. The details range from what security will be used, when the work will be carried out and – importantly for brokers – what type of insurance cover is required.

Overall, it provides peace of mind for all parties and ensures the renovator is in the best possible position throughout the project.

 

 

 What JCT insurance covers

JCT insurance would provide cover for damage to the neighbouring property where negligence cannot be proven. JCT insurance/Non-negligence Liability is an extension of the Public Liability section. The main difference is that Public Liability insurance requires a negligent act to have caused the damage, however, this cover extends to include damage caused where there are no negligent acts, i.e. major groundworks causing cracking to a neighbouring property. As a condition of our policy wording, we ask that all contractors have at least £2m Public Liability cover to make sure the right level of cover is in place should they be at fault for damage to your property or the neighbouring property.

The types of perils covered under the Non-negligence extension include subsidence, heave, collapse, vibrations or weakening/removal of support or the lowering of ground water upon carrying out the contract works.

Project types that need JCT insurance

Common examples of when JCT insurance/Non-Negligence insurance would be recommended would include properties that are semi-detached or terraced and undergoing major grounds works, or works on a party wall, such as basement, underpinning or piling etc. If a party wall award has been issued, you may find that this makes you financially liable for damage to the neighbouring property. Therefore, this would be a cover you may wish to consider.

Why is JCT Insurance so important?

If the contractor is not found to be at fault (i.e. damage that couldn’t be foreseen and that no one could be held liable for), you may be held responsible for the costs incurred to rectify the damage. Due to the nature of these situations the claims could potentially be very large. This type of insurance is required for the policyholder to be able to claim for non-negligent damage and must be taken out before the structural or ground works have started.

 JCT insurance options

JCT insurance is normally stipulated within your JCT contract. JCT stands for Joint Contractors Tribunal. It’s a type of contract often drawn up for specific one-off building projects and can be purchased directly from the JCT.

JCT contracts are designed to clarify all aspects of the project and avoid having disputes over who was at fault in the event of a problem. The details range from what security will be used, when the work will be carried out and most importantly for brokers, what type of insurance cover is required.

They also ensure the renovator is in the best possible position throughout their project as it helps provide peace of mind.

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How to get JCT insurance?

Joint names insurance can be included as an optional extra within our Premier Plus level of cover. A proposal form would be required, which would detail project specifics. When offering this cover, we normally offer a limit of indemnity between £1m and £2m. It is important to take into consideration the value of the properties surrounding you when selecting this amount. An excess of £2,500 would apply and the JCT insurance would provide an indemnity period of 12 months after the expiry or cancellation date, whichever is sooner.

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