News

If you work in construction, building or other related trades, you may have come across Contractors All Risks (CAR) Insurance and Professional Indemnity (PI) Insurance and wondered which you need. Maybe you’re curious if Contractors All Risks Insurance is the same as Professional Indemnity Insurance?  And you possibly have questions about whether you need one, the other, or both? 

The simple answer is - it depends on the type of work your business carries out!

Whilst both types of insurance can be important for contractors, builders and construction professionals, they protect against very different risks.

Contractors All Risks Insurance is designed to protect physical construction projects. It typically covers accidental damage to works in progress, materials, plant and equipment. For example, if a storm damages a partially completed extension or expensive building materials are stolen from site, a Contractors All Risks policy may provide cover.

Professional Indemnity Insurance, on the other hand, protects against claims arising from professional advice, design work, specifications, calculations or other professional services. If a contractor, architect, engineer or surveyor makes an error that results in financial loss for a client, Professional Indemnity insurance can help cover legal costs and compensation claims.

In some cases, businesses may need both types of cover. Consider a design-and-build contractor who is responsible for both carrying out the construction work and producing the designs. Or a building contractor who provides professional advice on jobs. Contractors All Risks insurance could help if there is a problem with the building work, whilst Professional Indemnity insurance could respond if a design flaw leads to costly remedial work.

As construction projects become increasingly complex, relying on a single policy may leave gaps in your protection. Understanding where one policy ends and another begins is essential to ensuring your business is adequately covered.

An experienced insurance broker, like Prizm Solutions, can review your activities, contracts and responsibilities to help determine whether Contractors All Risks insurance, Professional Indemnity insurance, a combination of both, or something else entirely is most appropriate for your business.

The good news is that obtaining expert advice costs nothing. You can always ring Prizm and speak to one of our friendly team – we’re always happy to help.  And the benefit of doing that is it could help prevent any expensive surprises if something goes wrong. That’s definitely not the time to find out that your current insurance doesn’t cover those particular circumstances! 

And it’s not just about the insurances mentioned above.  Prizm can help with a whole range of personal and business insurances, including Commercial Vehicle Insurance, Tools & Equipment Insurance, Annual Travel Insurance, Personal Accident Insurance and Renovation or Property Conversion Insurance. Just get in touch, we’d love to help you and find out more about you and your business.