What Is Contractors’ All Risks Insurance?
Contractors’ all risks insurance is a construction package built around a contract works section, with plant, hired-in plant, employees’ tools and effects, temporary works and debris removal added alongside it. It insures the project and everything you bring to it.
It is the step up from the works section inside a standard tradesman insurance policy, and it exists because bigger jobs put far more than materials at risk on site.
This guide sets out what each section does, where the market uses the terminology loosely, and when a jobbing trade genuinely needs the wider package.
Contractors’ all risks builds on a standard contract works section by adding plant, hired-in plant, employees’ tools and effects, temporary works and debris removal into one package. It’s the step up a jobbing trade needs once a job puts more than materials at risk on site, so check the wording rather than assuming the name covers everything. Confirm whether public and employers’ liability sit inside the policy or need buying separately.
Compare contractors’ all risks quotes for your next bigger job.
- What sections does a contractors' all risks policy contain?
- Is contractors' all risks the same as contract works insurance?
- Why does hired-in plant need its own section?
- What does all risks actually mean in the wording?
- Does the policy cover the maintenance and defects period?
- Does contractors' all risks include public and employers' liability?
- Who needs to step up from contract works to all risks?
- How is a contractors' all risks policy priced?
- What should you check in the wording before you buy?
- Frequently asked questions (FAQs)
What sections does a contractors’ all risks policy contain?
A contract works section sits at the centre, with plant, hired-in plant, employees’ effects, temporary works and debris removal bolted around it. Liability sections are often included but are not part of the all risks cover itself.
The contract works section at the core
This insures the permanent works you are building, plus materials and unfixed goods on site, from commencement to practical completion. Every contractors’ all risks policy contains it.
It is the same insuring clause you would find on a standalone works policy, and what a tradesman policy covers explains where it sits in a smaller package.
Own plant and hired-in plant
Owned plant covers dumpers, excavators, telehandlers, mixers, generators and compressors that belong to you. Hired-in plant is a separate section because the liability under a hire agreement is far wider.
Employees’ tools and personal effects
Most contractors’ all risks wordings include a modest limit for tools and personal belongings belonging to your workforce. The limits are small and rarely replace a proper tools section.
Temporary works, debris removal and fees
- Site huts, cabins, hoardings, fencing, formwork and propping.
- Debris removal and site clearance after an insured loss.
- Professional fees for architects, engineers and surveyors on reinstatement.
- Free issue materials supplied by the client, where they are declared.
- Extra cost of complying with public authority requirements on rebuild.
| Section | What it insures | How the limit is usually set |
| Contract works | Permanent works, materials and unfixed goods on site | Largest single contract value, labour and materials |
| Own plant | Plant and machinery you own and use on site | Total replacement value of the fleet |
| Hired-in plant | Plant hired from a supplier, plus continuing hire charges | Maximum value of plant on hire at one time |
| Employees’ effects | Workforce tools and personal belongings | A small limit per person and per event |
| Temporary works | Cabins, hoardings, fencing, formwork and propping | Declared value of temporary items on site |
| Debris removal | Clearing the site after an insured loss | A percentage of the works sum insured |
Is contractors’ all risks the same as contract works insurance?
Not quite, though much of the market treats the two names as interchangeable. Contract works is the insuring section, and contractors’ all risks is the package that always contains it and usually adds more.
Why the terms get used loosely
Several major insurers title the same product page with both names and use them as synonyms throughout. Some brokers, meanwhile, market them as two separate products.
Neither camp is being dishonest. They are describing the same core cover from different ends, which is why quotes with identical labels can differ so much in scope.
What actually differs between them
Ask what sections are attached rather than what the policy is called. A works-only section leaves plant, hired-in plant and temporary works uninsured.
| Contract works | Contractors’ all risks | |
| What it is | A single insuring section | A package built around that section |
| The works themselves | Insured | Insured |
| Own plant and machinery | Not included | Usually a named section |
| Hired-in plant and hire charges | Not included | Usually a named section |
| Employees’ tools and effects | Not included | Small limit commonly included |
| Temporary works and site huts | Sometimes, if declared | Normally included |
| Debris removal and fees | Sometimes capped | Normally included |
| Maintenance and defects period | Rarely | Often available as an extension |
| Typical buyer | Jobbing trade running one or two builds | Contractor running larger or JCT projects |
Which one a contract is asking for
If a tender says all risks cover, send the schedule rather than the certificate so the client can see the sections. Prequalification bodies such as CHAS, which renews annually, will ask for the same detail.
Why does hired-in plant need its own section?
Because plant hire contracts make you responsible for loss or damage from any cause, whether or not it was your fault. That is a strict liability your works section will not touch.
What the cpa model conditions say
Under clause 13(b) of the CPA Model Conditions, the hirer must make good all loss or damage to the plant from whatever cause, fair wear and tear excepted. It runs from the moment the plant leaves the owner’s depot until it is returned.
Fault does not come into it. A machine stolen from a fenced compound overnight is still your bill.
Continuing hire charges
Hire charges keep running at idle-time rates until a settlement is agreed, and clause 25 sets idle time at two-thirds of the normal rate. A scaffolder or groundworker with plant on long hire can watch that figure climb for weeks.
A proper hired-in plant section insures both the plant value and those continuing charges. Check that the second element is actually there.
Setting the hired-in plant limit
Base it on the maximum value of plant you have on hire at any one moment, not the annual hire spend. One busy fortnight sets the number.
What does all risks actually mean in the wording?
It means the policy insures physical loss or damage from any cause except those it names as excluded. That is the opposite of a named perils wording, which only pays for listed events.
Insured unless excluded
A named perils policy lists fire, storm, flood, theft and impact, and pays for nothing else. An all risks wording starts from everything and then subtracts.
That difference decides odd claims: a lorry reversing into finished blockwork, a load dropped by a crane, a partition knocked through by another trade.
The exclusions that remain
- Defective workmanship, defective materials and defective design.
- Wear, tear, gradual deterioration, rust, corrosion and settlement.
- Existing structures, unless a specific extension is bought.
- Consequential loss, delay, penalties and liquidated damages.
- Terrorism and war risks, which are excluded across the market.
Conditions attached to fire and hot works
Hot works carry the heaviest conditions on any construction policy, and HSE construction guidance explains why fire risk peaks while a building is open and unfinished.
Typical permit conditions require a continuous fire watch for at least an hour after work finishes, then checks at no more than 20-minute intervals for a further hour. Combustibles must be cleared within 10 metres, including the floors above and below.
The Joint Code of Practice, now in its 10th edition, applies to projects with an original contract value above £2.5 million. Below that threshold, insurers still impose their own permit conditions.
Does the policy cover the maintenance and defects period?
Often yes, through a maintenance extension that runs on after practical completion. It is one of the clearest points of difference from a plain contract works section.
What a maintenance period covers
During the defects liability period you return to site to put snags right. A visits maintenance extension insures damage you cause to the completed works while doing that.
Wider extensions also pick up damage arising during the construction period that only shows itself after handover. The two are priced differently.
Where the defective design line sits
No policy pays to correct the defective element itself. Better wordings do pay for damage that defect causes to the rest of the works, which is the more expensive half of the loss.
Design responsibility usually pulls professional indemnity into the picture too, and what general liability insurance means is a useful primer on how these covers divide up.
Matching the Period to the Contract
JCT contracts commonly set a defects period of six or twelve months. Tell the insurer which applies, because the extension has to run at least that long.
Does contractors’ all risks include public and employers’ liability?
Frequently, but not always, and the liability sections are bolted on rather than part of the all risks cover. Never assume a contractors’ all risks quote satisfies your legal obligations.
Employers’ liability is the compulsory element
Under the Employers’ Liability (Compulsory Insurance) Act 1969 you must hold at least £5 million of employers’ liability cover from the day you take anyone on, and most insurers issue £10 million as standard.
Trading without it costs £2,500 for every uninsured day, with a further £1,000 for failing to display or produce the certificate. An employers’ liability policy inside a wider package still has to meet that minimum.
Public liability and the limits contracts demand
Local authorities, main contractors and public sector clients commonly specify £5 million of public liability cover, well above the £1 million many domestic trades carry.
The two liability covers answer different claimants, and the difference between employers’ and public liability is worth being clear on before you sign a subcontract.
Reading the schedule section by section
A schedule lists each section with its own limit and excess. Check every one against the contract before you tell a client you comply.
Who needs to step up from contract works to all risks?
Anyone running plant, hiring in machinery, putting temporary works on site or working to a JCT contract with a defects period. Below that, a works section usually does the job.
The triggers that justify the package
- You own or hire dumpers, excavators, telehandlers or powered access.
- You put cabins, hoardings, propping or formwork on site.
- Your contracts carry a defects liability period you must return for.
- You employ a crew whose own tools travel to site with them.
- A tender specifies all risks cover in joint names with the employer.
Who can stay with a works section
A builder running two domestic extensions with hand tools and hired scaffolding rarely needs the full package. The works section plus a tools section covers the real exposure.
The decision is about what is on site, not about how the product is branded. Price both and compare the schedules, not the names.
Where larger projects change the answer
Once you move into construction contracting proper, with plant on hire and subcontractors on site, the wider package stops being optional in practice.
How is a contractors’ all risks policy priced?
Insurers rate it on the value at risk, the type of work, the contract length and your claims record. Annual policies are usually better value than arranging cover job by job.
Annual cover versus single project cover
An annual policy carries a maximum contract value and covers every job below it. A single project policy is written for one contract and one duration.
Contractors with a steady flow of work almost always come out ahead on annual cover, and there is no risk of starting a job uninsured.
What moves the premium
- Maximum contract value and the total works sum insured.
- Trade and activity, with demolition and hot works rated hardest.
- Plant values, both owned and hired-in.
- Site security, fencing, lighting and lock-up arrangements.
- Claims history and the excess you accept on each section.
Where it sits against a standard trade package
Money.co.uk publishes a worked quote of £66.88 a month for a trade business on £250,000 turnover with contract works included, which gives a sense of the entry point. How much tradesman insurance costs in the UK sets that against simpler policies.
What should you check in the wording before you buy?
Check the maximum contract value, whether cover is in joint names, whether subrogation is waived against subcontractors, and the excess on every section. Those four decide whether the policy actually answers.
Joint names and waiver of subrogation
Joint names cover means the employer and contractor are both insured under the same policy. Without a subrogation waiver, an insurer can pay a claim and then recover from whoever caused it.
Subcontractors are the usual target of that recovery. If you subcontract, get the waiver confirmed in writing.
The maximum contract value trap
Annual policies carry a ceiling on any single contract. Win one job above it and that job is uninsured, not partially insured.
Tell the broker before you sign, not after. Mid-term increases are routine and cheap compared with the alternative.
Excesses, limits and sub-limits
Each section carries its own excess, and theft and storm often carry higher ones. Read the sub-limits on debris removal and professional fees, which are commonly a percentage rather than a full liability limit.
Frequently Asked Questions (FAQs)
No. Only the employers’ liability section inside it is compulsory, and only once you employ someone. Everything else is driven by contract.
Not exactly, although many insurers use the names interchangeably. Contract works is the core insuring section, and all risks is the package that contains it plus plant and other sections.
Only to a small limit for employees’ tools and effects, if that section is included. A proper tools section is still worth holding separately.
Where a hired-in plant section is included, yes. It matters because hire agreements make you liable for loss or damage from any cause, plus continuing hire charges.
Not as standard. Existing structures are excluded unless you buy the specific extension, which is the usual gap on extensions and refurbishments.
The policy insures loss or damage from any cause except those it names as excluded. It is broader than a named perils wording that only lists specific events.
Yes. Annual cover with a maximum contract value handles every job below that ceiling, which suits contractors running work in parallel.
It depends on the project cover. Some principal contractors insure the whole works in joint names, while others require subcontractors to arrange their own.
Only where a maintenance or defects extension is bought. Without it, cover ends at handover.
That contract falls outside the policy. Tell your broker before signing so the limit can be increased mid-term.