Question: I am considering a loft conversion but my neighbour has requested my contractor takes out non-negligence insurance as a condition to the agreement / award… what does this mean ?
Answer: Non-Negligent Insurance requires the contractor to take out insurance to cover Indemnity on behalf of you the Employer, typically associated with the Joint Contracts Tribunal Standard Building Contract.
Non-negligent damage occurs when damage or loss has been caused to a third party, namely, an adjoining owner. Usually a Contractor’s (builder’s) insurance will cover such damage unless no breach of contract or negligence has been exercised by the Contractor.
A request of such insurance would therefore require you the Employer, and the Contractor (in the instance of a joint names policy) to take out an insurance policy to this effect.
However,
In the circumstance of a loft conversion, depending upon the terms of the insurance policy, it would be futile since such policies do not cover claims that are in respect of reasonably foreseeable events (for Contractors & Designers) and the Party Wall etc. Act 1996, arguably, covers such circumstances.
Further, if this is indeed a party wall matter such insurance would be irrelevant to your neighbours since they have both the right to seek security for expenses if they are concerned, and the right to that security, as compensation, should any damage occur to their property.
The insurance, if valid, will enable monies to be ascertained should damage occur. The acquisition of an insurance policy should be discussed with the insurance provider to ensure claims can be achieved under the proposed scope of works.
Further Reading
5th April 2003 – The Telegraph – Take Cover before the Builder’s Come