There is no single Australia-wide rule making Contract Works Insurance compulsory for every construction project.

Whether it is required can depend on:

• The construction contract
• Principal or developer requirements
• Lender requirements
• Project structure
• Applicable state or territory requirements

What can the construction contract require? #

The contract may specify:

• Who must arrange Contract Works Insurance
• Which parties need to be insured
• Required limits
• Period of insurance
• Public Liability requirements
• When evidence of insurance must be provided

A principal, developer or head contractor can also require evidence of cover before work commences.

A lender or financier may require the construction works to be insured as a condition of funding.

Who should arrange the policy? #

Depending on the project, responsibility may sit with:

• Builder
• Principal contractor
• Property owner
• Developer
• Another project party

The construction contract should be checked rather than assuming responsibility automatically sits with one party.

Contract Works Insurance should also not be confused with statutory building warranty, Building Indemnity or Home Building Compensation schemes.

Contact our team if you need help reviewing the insurance requirements in a construction contract.