What is Self-Build Insurance

Self-build insurance is an insurance policy that provides coverage during the construction of a new home, additional structure, renovation or conversion. Self-build insurance provides financial compensation for setbacks and problems that may occur during the project, such as contractor disputes, accident, injury, death, theft, arson, vandalism and project delays. If the project is being financed with a loan, the lender may require the borrower to purchase self-build insurance.

BREAKING DOWN Self-Build Insurance

In addition to covering the project itself, self-build insurance often covers materials related to the project. It may also provide legal coverage to the insured in the event of a lawsuit related to the project. Self-build insurance is primarily used in the United Kingdom and Ireland. In the United States, this product is known primarily as builder's risk insurance.

As an example of how self-build insurance protects home builder, consider if a contractor was hurt while working on the property or if a major weather event destroyed your site or if thieves took valuable building materials from the jobsite during the night. Self-build insurance would cover these scenarios. Self-builders can't rely on the insurance that their builders and contractors carry, as it may not cover their own unique liabilities. Their policies protect them from risk, but don't extend to you. Neither will standard home insurance cover the risks of building or renovating a home.

Self-build insurance is available with a wide range of protections. These policies are sometimes called contract works insurance and are very similar to standard home insurance, in that they usually protect both the items on your building site, the construction and any liabilities. However, it's always important to read the small print to make sure the policy meets all your needs, because some self-build insurance policies are more comprehensive than others.

Typical Risks Covered by Self-Build Insurance

  • Injury to members of the public, both off site and visitors
  • Injury to workers
  • Injury to trespassers and kids onsite without permission
  • Personal injury
  • Work site theft
  • Vandalism
  • Accidental damage
  • Defect
  • Floods

Popular Add-On Coverages for Self-Build Insurance

  • Existing structure and buildings
  • Mortgage payment protection
  • Legal expenses
  • Site huts and RVs for living/managing project
  • Plant and equipment: owned or hired
  • Employee tools
  • Personal accident
  • Contents insurance for a temporary RV at the site for living and/or managing the project. (You may need a separate policy)
  • Buildings and contents insurance – on completion of the build and for the remainder of the policy term