Guide to retrospective insurance for construction projects


While in an ideal world, an appropriate structural defects policy should be in place from before the start of a construction project, sometimes that simply isn’t possible and retrospective insurance cover is needed instead, once the project is close to completion or even fully completed.

Without the right cover in place, a newly completed building won’t be mortgageable and therefore selling it can be a huge challenge. No potential buyer or lender will usually want to take on the risk themselves in case a serious structural problem is found in the first few years after the projected is finished. The costs of remedying the problem, or potentially demolishing and rebuilding, can be significant and this is why retrospective building warranties are needed.

There could be several reasons why a construction project is near to completion but doesn’t have an appropriate warranty in place, but the most common of these if is a developer or building firm takes over a partially finished project. It might be that the original developer has ceased trading or doesn’t have the funds required to complete the build themselves. Whatever the reason, the new developer or builders need to ensure that the right cover is in place by the time the project is completed so that it is able to be sold and to give confidence and peace of mind to the new owners.

How retrospective insurance policies work

A retrospective insurance policy will cover the property for the first 10 years after completion in the event that a serious structural defect is found that is due to issues with the design, workmanship or construction of the building.

Before the policy can be issued, a structural survey must be carried out on the building, to assess the design and structural integrity of the property, ensuring that it complies with the necessary requirements. All of the relevant certificates from the build process will also need to be reviewed, such as building reg sign-off and gas and electrical certificates, along with the EPC.

If it is found to be compliant, an insurance certificate will be issued for the building.

A retrospective warranty usually takes somewhere between one and four weeks to process, once the application has been made.

If you want to find out more about how retrospective insurance works or require a quote for your project, use the online form to contact us.

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Advantage Home Construction Insurance (AHCI) provides structural defects insurance – operating nationally with offices in Warrington, London and Birmingham – offering development-related insurances and a service designed to give customers peace of mind.

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