22 Aug Understanding Earthworks Advantage Insurance
Understanding Earthworks Advantage Insurance
With standard Construction Insurance, there are certain events related to earthworks that would be excluded under your policy. For example, because rain may be considered an ‘expected’ event (if normal for the area and time of year) you may not be covered from damage caused by rain. You also wouldn’t be covered for the result of defective design, as the policy assumes you would be able to recover costs from another policy (for example your architect or engineer’s insurance policy).
Rain and defective design have the potential to cause problems with your earthworks projects, and the costs of stabilising the affected area, replacing dislodged material, and even reducing moisture in stockpiled material can quickly mount up. Earthworks Advantage Insurance can provide certainty of cover during earthworks and excavations, covering landslip, subsidence, collapse or displacement events.
On average 80% of all building construction involves some form of bulk earthworks. Most earthworks collapse-related claims involve issues surrounding the design and/or weather influence.
Here’s an example of what Earthworks Advantage Insurance would cover:
Construction business owner Peter engaged an engineer to design a basement level excavation. The design presumed the geology could support near vertical sides to the excavation without needing any retention. But after rain, that was normal for that time of the year in that area, one side of the near-complete excavation collapsed almost along its entire length.
To rectify the situation, the excavation was temporarily stabilised using gravel to refill the excavation, then ‘bored and poured’ piling was installed in the area of collapse. Afterwards, the gravel was re-excavated. Stockpiled soil that was intended for back-filling then had to be dried before it could be used.
As a result, Peter was left with $585,000 in additional costs. After the special excess of $25,000 was paid, Peter’s Earthworks Advantage Insurance covered the costs of:
- gravel infill ($100,000 to supply and remove)
- retention piles ($450,000)
- soil drying operations ($10,000)
- consultant’s fees and extra plant hire costs ($25,000)
What’s Covered – And What’s Not?
1. replacing insured material
2. constructing a support and retention system
3. temporarily stabilising the area and removing it when required
The policy wording spells out the details, but these are the main things relating to a claim.
Earthworks Advantage Insurance is extra cover that can protect you from the cost of remediating earthworks subsidence, collapse or displacement, caused by the weather and/or defective design.
You can add it as an optional extra to your Single or Annual Construction Insurance. For a quote on a more comprehensive Earthworks Advantage Insurance policy with higher limits and more features, talk to CRM Brokers today on 1300 880 494.
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