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[ Spotlight: Insurance ]


events. If a fall is not fatal, it can still be disastrous for a contractor operating alone or as part of a small company. For a larger company, an employers’ liability claim arising from a serious fall injury will cost at least £300,000-£400,000 in damages, and can easily exceed £1m. Aside from the moral obligation to keep people safe,


no contractor would want a million-pound claim on its insurance record. There are additional hidden costs to such an accident,


beside the compensation claim that could jeopardise a company’s future, such as the costs associated with investigations, legal paperwork, liaison with the safety authorities, hiring replacement staff and reputational damage. In the case of an employee accident, there is always


a strong possibility that the employer may be found to have failed in its duty of care and held liable. This is why it is important for the managers of businesses involved in height work to understand the risks to which their workforce are exposed. It is essential, therefore, that a contractor involved


in working at height is covered by an insurer that understands these risks and is able to give adequate information and advice. As a specialist building services insurer, the ECIC fully understands these risks.


Liability Contractors sometimes ask us if it makes a difference to liability whether they are the principal contractor or simply one of a number of sub-contractors on a project. This question is regularly brought into sharp focus in the area of renewable energy installations because they sometimes involve multiple contractors, or the installations are done as part of a new-build project involving numerous sub- contract trades. The answer is that, in the case of a building site with


multiple contractors, there is likely to be a shared liability. However, a contractor that is not the lead contractor should never expect to be exempt from blame in the case of an accident.


Specialists When the economic environment is tough, building contractors of all kinds will sometimes cut back on their experienced staff and supervisors. This is a false economy. The electrical, mechanical and roofing trades involved


in green installations are individually well understood by insurers. However, there are few insurers with combined experience of all three fields, which is why we at the ECIC have been able to contribute greatly to the renewable energy arena in recent years. Unfortunately, only a small number of insurers have been


able to keep pace and offer appropriate cover for this growth sector. As well as solar panel installations, the contractors that the ECIC insures are offering micro CHP, wind turbines, solar thermal, biomass and heat pumps. Installers involved in ground source heat pumps and


ventilation heat recovery systems may also have to consider a new dimension to their insurance cover. Since


66 ECA Today September 2011


An employers’ liability claim arising from a serious fall injury will cost at least £300,000- £400,000 in damages, and can easily exceed £1m


these systems are usually in the ground, contractors need to think about how they will insure against, and minimise, the risks to employees, consumers and the public. In addition to the electrical side, several renewable energy


technologies also have a mechanical element. This requires a further skill set by the contractor and an additional set of considerations in the assessment of insurable risk.


Insurance services Contractors should have two important criteria in mind when it comes to the services they require from the insurance industry. The first is always to ask their brokers to source only specialist insurance policies that address the specific nature of the activities they engage in. The second is to keep their broker and insurer fully informed of the type of work they are undertaking. The ECIC’s policies are specifically designed for specialist


building services contractors, including green energy installers, and reflect the demands and needs of this sector. For example, can you be confident that a general insurer covering an ‘electrical contractor’ is aware of, and has agreed to cover, the installation of solar panels on roof decks? Without the insurance industry to evaluate and advise


and respond to the risks involved, it would be difficult for everyone – from large organisations and governments all the way to individuals, SMEs and renewable energy installers – to adopt more environmentally-friendly solutions for their energy needs.


SHUTTERSTOCK


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