Insurance Tips

Back to Tips Index | Shiputzim – what to look out for

 

Are you building a new house/or doing a “shiputz” (alteration, addition)? What can insurance do for you?

The policy that you need is called Contractor’s Liability Policy (in Hebrew, “Avodot Kablaniyot”). With large projects, this cover is taken out by the Kablan. However, with small private projects, it is usually the home-owner who takes out such cover.

What does the basic policy cover?

All damage to the project during the insurance period (e.g. fire, flood, storm damage, arson, etc.) and most important, Third Party Liability for anyone injured on the site, e.g. visitors, neighbours. Workers are covered by Workers’ Compensation “Chavut Ma’avidim”.

What cover to ask for?

  • The project should be covered according to the final cost of the whole house. If your home is in an apartment block or connected to other homes, you must have cover for property being worked upon.
  • If there are other additions (e.g. kitchen, built-in cupboards, special tiles, etc.) these should be specified in the policy.
  • Cover for removing debris in case of an accident (usually up to 10% of value of project.
  • Include in the policy all contractors and sub-contractors.
  • Option for extending cover if project runs overtime.
  • Cover for direct damage as a result of faulty planning or of faulty materials.
  • Cover for 24 month maintenance period (which includes cover for problems that occurred during the insurance period but were only discovered later)
  • Cover for theft of on-site materials (usually requires 24 hour shmira.)

Our experience?

  • Make sure that you check out your Kablan (sounds obvious!) Any claims of willful initfada, related arson (e.g. stuffing pipes with concrete, not connecting internal pipes, etc.) is not covered under the policy and is not easy to claim for from Mas Rechush either.
  • If you are acting as the Kablan and taking on sub-contractors, check carefully with your lawyer and insurance agent and see if you are directly hiring the sub-contractors’ worker. If so, you must adjust the cover accordingly.
  • Good luck, mate!