1. Public Liability Insurance
Public liability insurance is the most fundamental cover a builder should hold. It covers claims for damage to property or injury to people (other than employees) caused by the contractor's activities.
In a domestic construction context, this means: if your builder accidentally damages your neighbour's property, knocks out a gas main, or causes an injury to a visitor on your site, public liability insurance is what covers the resulting claim.
Typical Minimums for Domestic Projects
- Small works (up to £50k): £1m minimum
- Domestic extensions and refurbishments: £2m–£5m
- Larger residential projects (over £500k): £5m+
- Commercial or complex projects: £10m+
A contractor whose public liability cover is at the absolute minimum for a large, complex project is underinsured for the risk. Always ask for the certificate — not just a verbal confirmation — and check that the limit is appropriate for the scale of your project.
2. Employer's Liability Insurance
Employer's liability insurance is a legal requirement in the UK for any business that employs staff. It covers claims from workers who are injured or become ill as a result of their work.
Critically, this applies not just to direct employees but also to subcontractors in many circumstances — particularly where the contractor exercises control over how and when the work is done. On a typical domestic construction project where the main contractor brings in multiple subcontractors, employer's liability insurance is essential.
The minimum limit is £5m by law, though most policies are written at £10m. A sole trader working entirely alone and engaging no subcontractors may not be required to hold this, but in practice, most reputable builders do. Ask for the certificate and check the expiry date.
3. Contract Works / All-Risk Insurance
Contract works insurance (also called all-risk insurance or contractors all-risk) covers the works themselves — the materials, the structure under construction, and the site — against loss or damage during the project.
This matters because neither your home insurance nor the builder's public liability insurance will necessarily cover damage to the partially built works. If your half-complete extension is damaged by fire, flood or vandalism, without contract works cover, the cost of rebuilding may not be covered by any policy in place.
Not all builders carry contract works insurance as standard — some include it project by project, some expect the client to arrange it. Ask specifically: is contract works / all-risk insurance in place for this project, and what does it cover?
What Contract Works Insurance Typically Covers
- Materials on site and in transit
- Works in progress (the partially built structure)
- Existing structure where the contract specifies cover
- Plant, tools and equipment (often subject to limits)
- Accidental damage, fire, flood, storm, vandalism and theft
4. Professional Indemnity Insurance
Professional indemnity (PI) insurance covers claims arising from professional errors, omissions or negligent advice. For a pure build-only contractor, PI is not typically required. However, on a design-and-build project — where the contractor is also responsible for design, specification or technical decisions — PI becomes relevant.
If your contractor is specifying structural solutions, advising on planning, or producing design drawings as part of their service, ask whether they carry professional indemnity insurance. A contractor offering a full design-and-build service should have PI in place.
5. Your Own Home Insurance — What You Need to Know
Your home insurance does not automatically cover you during a major construction project. There are several important points to be aware of:
Notify your insurer before works start
Most home insurance policies require you to notify your insurer before significant construction work begins. Failure to notify may void your policy — meaning you would have no cover for unrelated claims (fire, theft, escape of water) during the build period.
Unoccupied property risk
If you move out during a major refurbishment, standard home insurance policies typically include an unoccupied property clause — often 30, 60 or 90 days. Beyond that period, cover may be reduced or voided. You may need specialist unoccupied property or renovation insurance.
Existing structure cover during works
Your home insurance may not cover the existing structure against damage caused by the construction activities — that may fall under the contractor's contract works insurance. Check with both your insurer and your contractor to ensure there are no gaps.
What to Ask For — and What to Check
Never accept verbal confirmation that a builder is insured. Always ask for the actual certificates. Here is what to ask:
Can you provide your public liability insurance certificate?
What is the limit of indemnity, and is that sufficient for my project?
Do you carry employer's liability insurance for your staff and subcontractors?
Is contract works / all-risk insurance in place for this project?
Is professional indemnity insurance relevant to the design elements of this project?
When do each of these policies expire?
When you receive a certificate, check: the insured name matches the company you are contracting with; the policy is current (check the expiry date); the limit of indemnity is appropriate; and the policy type matches what was described.
Warning Signs
How RCB Handles Insurance
RCB carries comprehensive insurance cover as standard on every project:
- Public liability insurance — minimum £5m
- Employer's liability insurance covering all directly employed staff and subcontractors
- Contract works / all-risk insurance arranged for every project
- Professional indemnity insurance covering our design and specification activities
We provide certificates on request at any stage of the project — pre-contract, during works or for any third party who requires them (solicitors, lenders, insurers).
Disclaimer: This guide is for general information only and does not constitute insurance or legal advice. Insurance requirements vary depending on the nature and value of the works, the structure of the contract, and individual circumstances. Always seek independent advice for your specific situation and verify all insurance documentation with the relevant parties.