Construction Insurance and UK Construction Contracts
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CHAPTER 19
Contract insurance under JCT Minor Works Contract 2011
General
19.1 The Minor Works Contract 2011 Edition (“MW11”) is a traditional building contract. It was included in the 2005 suite of contracts as a like-for-like replacement for the JCT Agreement for Minor Building Works 1998 Edition. MW11 brings the insuring provisions further in line with the Standard Building Contract 2011, compared with MW05. 19.2 MW11 is appropriate for works that are simple in character, where the work is designed by, for or on behalf of the employer, where the employer is to provide drawings and/or a specification and/or works schedules that adequately define the works and where the conditions are to be administered by an architect/contract administrator. It is hardly surprising, given the contracts at which the MW2011 contract is targeted, that the insuring provisions are not as extensive or onerous as that provided for in Standard Building Contract 2011. Accordingly, the employer should consider carefully whether this form of contract adequately safeguards its interests. 19.3 For contracts where the employer requires the contractor to undertake some portion of the design, the appropriate contract is the Minor Works Building Contract With Contractor’s Design (“MWD”). This has been updated in the 2011 suite (with amendments in March 2015 to reflect the Construction (Design and Management) Regulations 2015). MWD contains identical insurance provisions to MW, so the comments below apply equally to MWD. Unlike the Intermediate Building Contract with Contractor’s Design 2011 Edition (ICD), MWD11 does not include an option to require professional indemnity insurance in respect of the contractor’s design portion; and this may influence an employer’s choice of contract.Relevant provisions
19.4 The key insurance provisions are contained in section 5. They are:- Clause 5.1: The contractor indemnifies the employer against claims in respect of death and personal injury arising from the carrying out of the works, except to the extent that the same is due to any act or neglect on the part of the employer or any person for whom the employer is responsible.
- Clause 5.2: The contractor indemnifies the employer against property damage arising from the carrying out of the works, but only to the extent that the damage is due to the contractor’s negligence.
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Clause 5.3: The contractor is required to take out and maintain (and to cause any sub-contractor to take out and maintain) insurance to cover his liabilities under clauses 5.1 and 5.2.Page 277
- Clause 5.5: The contractor and the employer are both required to produce evidence of their respective insurance policies as required by clause 5. There is an exception for employers who are local authorities.
- 5.4A: The contractor takes out and maintains an all risks policy in the joint names of contractor and employer.
- 5.4B: The employer takes out and maintains:
- a policy in respect of existing structures together with the contents which the employer either owns or is responsible for; and
- a policy in respect of existing structures together with the contents which the employer either owns or is responsible for; and