Contract works Insurance – How to build with confidence

December 10, 2020


What is contract works insurance?

Contract Works Insurance, including Public & Product Liability Insurance (can also be known as Construction Insurance), is an insurance policy that is used by builders, tradies or subcontractors to provide insurance coverage against loss or damage to their building projects

How does contract works insurance works?

There are two ways that contract insurance can operate and be purchased:

  • One-off contract works
  • Annual contract works

Contract Works Insurance that is either one-off contract works insurance policies or annual contract works insurance policies can be utilised at different times to enable construction works to develop their build projects whilst reducing risk through contract works insurance.

Contract Works Insurance can provide coverage for the builder, sub-contractor or tradie’s legal liabilities during the project and when the work is being carried out and once the project is completed.

What liability limits come with contract works insurance?

Liability limits can scale up to meet your individual or project requirements. Typically, liability limits start in bands of $5m, $10m or $20m.

Can Contract Works Insurance policies provide specific sub-limits?

Some Contract Works insurance provide sub-limits across different construction and building items and risks that your construction build might face.

Sub-limits may apply across:

  • Tools; especially if provided by an employee
  • Sourced & supplied materials required for construction that are stored either onsite or offsite.
  • Equipment and machinery that are required on-site.
  • Materials that have been supplied by the principal
  • Goods in transit cover for supplies.

What happens after the build and construction is completed?

Contract works insurance can provide coverage for liabilities or defects that occur post the completion of a project or build. There are timeframe limitations that exist around the length of time that the contract works insurance provides coverage once a project is complete. It is worth understanding your statutory obligations when undertaking a build and assessing if the insurance you are engaging provides adequate coverage for the length of time required.


General Advice Warning: This advice is general and does not take into account your objectives, financial situation or needs. You should consider whether the advice is appropriate for you and your personal circumstances. Before you make any decision about whether to acquire a certain product, you should obtain and read the relevant product disclosure statement.

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