The International Underwriting Association (IUA) has published a new fire safety model insurance clause for use in work being completed under the Building Safety Fund of the government.
“Our new model clause sets out a number of key risk management processes that will ensure work being carried out is conducted within recognised industry standards,” said IUA legal and market services director Chris Jones. “This will help improve accountability for safety measures and foster an investment in quality construction.
“The market for construction professional indemnity insurance has been difficult in recent years, reflecting concerns about the potential for historic liabilities to develop into future claims following the Grenfell Tower tragedy. Each new risk must continue to be assessed on a risk-by-risk basis, of course, but the clause should provide underwriters with greater confidence to offer effective insurance solutions for future work.”
The wording was developed by the IUA and the Department for Levelling Up, Housing, and Communities. At no cost, the Building Safety Fund Cladding and Fire Safety Limited Exclusion and Aggregation Clause is available to download from the IUA website by underwriters looking to provide professional indemnity insurance for building cladding remediation work.
Levelling up Secretary Greg Clarke noted: “Our priority is making sure people’s homes are safe and that safety standards are high. Alongside our tough new regulatory regime, this new clause that has been developed with my department will help us do just that.
“We welcome the work of the IUA and the underwriters who are taking a proportionate approach to fire safety cover, and I thank insurers in advance for using it.”
The £4.5 billion Building Safety Fund was introduced to cover the cost of building cladding remediation work on high-rise residential blocks over 18m.
