Nec Contract Insurance Clauses

NEC Contract Insurance Clauses: Everything You Need to Know

When it comes to construction projects, insurance is an essential component to ensure that all risks are covered. The New Engineering Contract (NEC) is a popular construction contract used in the UK and worldwide. It is known for its flexible approach to project management and risk allocation. As such, it includes specific clauses relating to insurance. In this article, we will discuss everything you need to know about NEC contract insurance clauses.

What is the NEC Contract?

NEC is a family of contracts that are used to manage construction projects. It was developed by the Institution of Civil Engineers and is now widely used in the UK and internationally. One of the main features of the NEC contract is its emphasis on collaboration between the parties involved in the project. It is designed to be flexible and adaptable to the needs of each project. As such, it can be used for a variety of projects, from simple to complex.

What are NEC Contract Insurance Clauses?

The NEC contract includes specific clauses relating to insurance. These clauses outline the insurance requirements for the project and the responsibilities of the parties involved. The clauses cover a range of insurance types, including public liability, employer’s liability, and professional indemnity insurance.

Public Liability Insurance

Public liability insurance covers the legal liability of the contractor for injury or damage to third-party property. Under the NEC contract, the contractor is required to maintain public liability insurance throughout the project. The amount of insurance required will be specified in the contract documents.

Employer’s Liability Insurance

Employer’s liability insurance covers the legal liability of the contractor for injury or disease to its employees. The NEC contract requires the contractor to maintain employer’s liability insurance throughout the project. The amount of insurance required will be specified in the contract documents.

Professional Indemnity Insurance

Professional indemnity insurance covers the legal liability of the contractor for professional negligence or errors and omissions. If the contractor is providing design services under the NEC contract, it will be required to maintain professional indemnity insurance throughout the project. The amount of insurance required will be specified in the contract documents.

Other Insurance Requirements

The NEC contract also includes clauses relating to other insurance requirements, such as property insurance, motor insurance, and pollution liability insurance. The requirements for these types of insurance will depend on the specific project and will be specified in the contract documents.

Conclusion

NEC contract insurance clauses are an important component of any construction project. They ensure that all risks are covered and that the parties involved are protected from legal liability. If you are involved in a construction project that uses the NEC contract, it is essential to understand the insurance requirements outlined in the contract documents. Working with an experienced insurance broker can help ensure that you have the appropriate insurance coverage for your project.