Post-completion insurance
Post-completion insurance (more usually known as latent defects insurance) provides cover for latent defects. These are failures in design, workmanship or materials that may not become apparent until many years after practical completion of the project and long after the end of the defects’ liability period.
This form of insurance provides cover for new building work or for work on existing buildings. It is seen as providing more complete cover for defects than other methods (such as collateral warranties) which may require proof of breach of contract. Any party with an interest in the property (eg owner or developer) can be the insured (policy holder), but it can also be the funder or an incoming tenant who has repair obligations under a lease.
Available for a period of between 8-12 years from the date of final certificate or practical completion, post-completion insurance typically covers defects in the structure and weatherproof envelope of the building – but no other defects.
Whether an insurer decides to provide cover will depend on whether they are confident and satisfied regarding the original construction. However, when cover is provided, it usually involves significant premiums. For example, in the case of a contract works value of £2,500,000, a latent defects policy could cost around £25,000 to £30,000; when bearing in mind the excess is normally 1%, ie £25,000 of the sum insured, the first £50,000 (in this example) of any claim will have to be met by the insured.
[edit] Related articles on Designing Buildings Wiki
- Building Users' Insurance Against Latent Defects.
- Collateral warranties.
- Contractors' all-risk insurance.
- Contract works insurance.
- Decennial liability.
- Design liability.
- Directors and officers insurance.
- Employer's liability insurance.
- Excepted risk.
- Flood insurance.
- Future of construction insurance.
- Indemnity to principals.
- Integrated project insurance.
- JCT Clause 6.5.1 Insurance.
- Joint names policy.
- Latent defects insurance.
- Legal indemnities.
- Legal indemnity insurance.
- Non-negligent liability insurance.
- Performance bond.
- Professional Indemnity Insurance.
- Public liability insurance.
- Residual value insurance.
- Reverse premium.
- Specified perils.
- Subcontractor default insurance (SDI).
- Warranty.
Featured articles and news
Costs and insolvencies mount for SMEs, despite growth
Construction sector under insolvency and wage bill pressure in part linked to National Insurance, says report.
The place for vitrified clay pipes in modern infrastructure
Why vitrified clay pipes are reclaiming their role in built projects.
Research by construction PR consultancy LMC published.
Roles and responsibilities of domestic clients
ACA Safety in Construction guide for domestic clients.
Fire door compliance in UK commercial buildings
Architect and manufacturer gives their low down.
Plumbing and heating for sustainability in new properties
Technical Engineer runs through changes in regulations, innovations in materials, and product systems.
Awareness of the Carbon Border Adjustment Mechanism
What CBAM is and what to do about it.
The new towns and strategic environmental assessments
12 locations of the New Towns Taskforce reduced to 7 within the new towns draft programme and open consultation.
Buildings that changed the future of architecture. Book review.
The Sustainability Pathfinder© Handbook
Built environment agency launches free Pathfinder© tool to help businesses progress sustainability strategies.
Government outcome to the late payment consultation, ECA reacts.
IHBC 2025 Gus Astley Student Award winners
Work on the role of hewing in UK historic conservation a win for Jack Parker of Oxford Brookes University.
Future Homes Building Standards and plug-in solar
Parts F and L amendments, the availability of solar panels and industry responses.
How later living housing can help solve the housing crisis
Unlocking homes, unlocking lives.
Preparing safety case reports for HRBs under the BSA
A new practical guide to preparing structural inputs for safety cases and safety case reports published by IStructE.
Male construction workers and prostate cancer
CIOB and Prostate Cancer UK encourage awareness of prostate cancer risks, and what to do about it.