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Construction cover – which set of defects clauses is right for you?

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December 22, 2020

The broadest defects coverages available under certain construction policies are no longer widely available.

The insurance market has dramatically shifted in the past 18 months and the broadest defects coverages available under a Material Damage – Contract Works policy are no longer widely available. Do the second-tier defects clauses within the LEG and DE sets provide equivalent protection or should you be more selective for the benefit of your business and/or project?

This market hardening, and the need for you to make a choice when it comes to second-tier defects clauses, means it’s critical for you to consider your options to ensure the set of defects clauses in your Material Damage – Contract Works policy is most appropriate for your specific risk profile.

Willis Towers Watson’s Construction Team provides a comprehensive look at the various defects coverages available under a Material Damage – Contract Works policy and the differences between the LEG and DE clauses. In some instances there is little to no difference, but others there can be considerable scope for differentiation which can have a significant impact on a claims outcome.

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