The Protek Group’s Simon Middleton takes a look at some of the risks that can extend beyond people’s contingency, explaining how you can identify and manage your exposure more-effectively and why site insurance is so important
Aself-build project can be one of the most exciting and rewarding experiences you undertake in life, not only in terms of the personal achievement but also in the value you realise through your own efforts. At the project outset, careful consideration has to be given to the project’s feasibility. It is quite likely you have allowed an element of contingency in the budget for unexpected costs, but how do you protect yourself financially if those unexpected costs exceed the contingency?
Self-building involves more than just the project management aspect. You often have to take on the role of a risk manager as well. It’s a role that can seem a little daunting at first, but it can make a massive difference to your self-build experience. What would happen if an accident occurred on your site that caused damage to the property, or even a serious injury to a worker on site – would it be your responsibility?
Theft & vandalism
A suggested starting point is to consider the impact that theft, vandalism or a fire could have on your project. Identifying your exposure starts with risk assessment, which helps you identify the issues and enables you to take steps to manage them.
Self-build insurance plays a big part in this process. However, you should ensure you talk to an experienced specialist provider who will be able to guide you, because the types of risk you face may not be apparent from the outset.
Take theft for example. Thieves can be incredibly innovative and very destructive, so as well as the inconvenience of replacing the stolen items, the cost of repairing the damage and destruction caused to the property that has been broken into needs to be considered as well. Replacing items can make a big dent in budgets, too – for example, hired plant, tools and equipment will remain hired to you even if they have been stolen, so replacing them will be your responsibility. A telehandler, for example, could cost upwards of £18,000 – and you need to factor in that the continuing hire charges will be billed at around £125 per week until it’s been replaced!
Identifying where you are most at risk of a break-in will help you identify how good your security measures are. Temporarily boarding up openings in the structure helps and can provide a good deterrent against an arson attack, but ultimately you need to stop unauthorised access to your site using security measures as appropriate.
As well as the damage that could be caused intentionally by someone, weather can have disastrous affects on a site. For example, a gable end collapsing in a storm can bring tons of masonry down on the floor structures below causing damage.
The damage often affects the supporting wall structure that is stressed as a result of the sudden impact, which will lead to extensive rebuilding works.
Health & safety
If you are exercising control on site, you will invariably have some responsibility for health and safety. Many injuries occur due to a lack of forethought regarding who is at risk and when. Think about work areas, keep them free of hazards and consider what is going on above and below to ensure workers are not at risk from works going on elsewhere in the building. This is a common cause of serious accidents causing injury. Organising the works methodically and understanding who is at risk and when is crucial in managing your exposure to risk. Accidental damage to a third party or their property can occur at any time and can range from a relatively minor incident to something far more serious. A single brick falling from a scaffold could easily cause several hundred pounds worth of damage to a car below – but imagine the consequences of a failed scaffold board and an entire stack of bricks falling on a worker below. In addition to a likely investigation by the Health and Safety Executive (HSE) and the prospect of a prosecution to defend, the self-builder will invariably be responsible for damages. If the victim of the accident is seriously injured, those damages can run into millions as the self-builder will be expected to pay for the injured party’s care costs for the rest of their lives.
It’s unlikely that any individual will be able to put that level of contingency aside, which is why using a good self-build site insurance policy is so important. Site insurance is designed to help protect you against the financial risk that a serious loss can bring and is a proven risk management tool.
Simon Middleton is the founder of the Protek Group