ABIC contract works insurance

The Institute strongly recommends that architects should not give insurance advice. Owners should rely on insurance specialist advice only.

A Contract Works Insurance is included in the ABIC 2018 contracts. It states that whichever party is required to take out contract works insurance they must keep that contract works policy in place until 4pm on the date the architect issues the final certificate. It also states the policy must name the contractor, its subcontractors and the owner as insured parties.

Typically, it is the contractor who takes out contract works insurance, but the ABIC 2018 contracts gives the option in the schedule for either the contractor or owner to maintain contract works insurance.

Bear in mind that, under a typical contract works policy, irrespective of who took out the insurance, either party under the ABIC 2018 contract can (if there’s a claim) pay the excess to ensure the claim is covered. The Payment of Excess clause allows the party who pays the excess to have that amount reimbursed to them, to the extent that the other party is at fault. See the specific wording of the clause. The architect can then capture this adjustment in the next, or the final, certificate.