Did You Know? Faulty Design, Policy Exclusion in Construction All Risk Insurance Policy

Your Construction All Risk (CAR) policy consists of two main coverages which is Material Damage (Section 1) and Third Party Liability (Section 2). 

In this article, we would like to highlight the exclusions as stated under Special Exclusion Section 1 point (c) and (d) which is called “faulty design” exclusion, quoted as below:

The insurer shall not, however, be responsible for:
(c) loss or damage due to faulty design;
(d) the cost of replacement, repair or rectification of defective material and/or workmanship, but this exclusion shall be limited to the items immediately affected and shall not be deemed to exclude loss of or damage to correctly executed items resulting from an accident due to such defective material and/or workmanship; 

The above is one of the exclusions under the CAR insurance policy and we suggest you to review your policy wording in details and please consult us in case modification or additional coverage is required. If you have any further questions and/or concerns about the above aspect, please feel free to contact us at 021 – 2523110 and we would be pleased to assist you.