Contractors' All Risks Insurance for building contracts
Cover for the buildings and structures you are putting up, the materials waiting to go in and the plant on site, from first delivery to handover. Compare annual and single project policies through brokers who regularly place construction risks.
- Works and materials covered until handover
- Own and hired-in plant on the same schedule
- Annual cover for every contract you win
Reviewed October 2026 by the MyBusinessComparison.com editorial team
What is contractors' all risks insurance?
Contractors' all risks insurance, often called CAR, covers physical loss or damage to construction works while they are being built. It protects the permanent and temporary works, materials on site and, if chosen, plant, tools and site huts against fire, flood, storm, theft, vandalism and accidental damage until handover.
Building contracts usually say who must insure the works, and many require cover in the joint names of the client and the contractor. CAR is most often bought on an annual basis, covering every contract up to an agreed value, though large or unusual projects are often insured on their own.
It sits alongside your liability cover rather than replacing it. Injury to people and damage to neighbouring property fall under public liability, and claims from your own staff fall under employers' liability.
Contractors' all risks at a glance
- Protects
- The works, materials, plant and temporary buildings on site
- Runs until
- Practical completion, plus any agreed defects period
- Policy types
- Annual for all contracts, or single project
- Often required by
- JCT and other building contracts, clients and funders
- Priced on
- Contract values, type of work, site security and claims
- Not included
- Third party injury and damage, which sit under liability cover
What does contractors' all risks insurance cover?
A CAR schedule is built from sections. Each has its own sum insured and excess, and the contract works section is the one most clients will ask to see.
Contract works
Permanent and temporary works on site, including materials delivered and waiting to be fixed. Cover runs from the start of work until the building is handed over or taken into use.
Materials off site and in transit
Many policies give a limited amount of cover for materials stored at your yard, a supplier's premises or on the way to site, which matters when items are paid for before delivery.
Own plant and equipment
Excavators, dumpers, scaffolding, formwork and small tools you own, wherever they are on the job or between jobs.
Read more about plant and machinery insurance
Hired-in plant
Your liability for plant hired from others while it is in your care, often with continuing hire charges paid while a damaged or stolen machine is replaced.
Temporary buildings
Site cabins, welfare units, canteens and stores, together with the contents inside them.
Employees' tools and effects
Tools and personal belongings owned by your workforce and kept on site, usually up to a set amount for each person.
Debris removal and professional fees
The cost of clearing the site after damage and of architects, engineers and surveyors needed to redesign or supervise the rebuild.
Expediting expenses
Overtime, night work and express freight paid to get a damaged project back on programme, where the insurer agrees the spend.
Defects period cover
Damage you cause while returning to put right snagging after handover and, on wider forms, damage that appears in the defects period but traces back to work before handover.
Covers often bought alongside CAR
- Non-negligence cover in a contractors' programme: the client's exposure when your work damages a neighbour's property without anyone being at fault, often asked for in JCT contracts
- Public liability: injury to visitors and passers by, and damage to property next to the site
- Professional indemnity: for design and build contracts, where CAR will not pay for a design error itself
- Delay in start up: lost rent or income for the client when damage pushes back completion, usually arranged on larger projects
Who needs contractors' all risks insurance?
Any firm that is responsible for works until handover has a CAR exposure, whether the contract says so or not. These are the businesses that buy it most.
Need liability and works cover together? Many firms buy CAR inside a combined contractors' policy. See insurance for construction companies or the construction and engineering hub.
- Main contractors: who often insure the whole project in joint names with the client under JCT and similar contracts
- Building firms: extensions, refurbishments and new builds for homeowners and commercial clients
- Property developers: who build or convert on their own land and need the works covered until sale or letting
- Civil engineering contractors: roads, drainage, bridges and utilities, where the works sit in open ground and weather is a major threat
- Groundworkers: foundations, slabs and drainage that can be washed out or collapse before they are covered over
- Building services contractors: electrical, mechanical and fire installations that are damaged before they are signed off
- Shop fitters and fit out firms: high value fixtures fitted inside existing buildings, usually under tight programmes
- Renewables installers: solar arrays and plant installed on roofs and land before commissioning
- Renovation projects: refurbishments of existing buildings, where the client often insures the structure and the contractor insures the new work
How much does contractors' all risks insurance cost?
Annual CAR is rated mainly on the value of work you expect to carry out and the largest single contract you might take on. These factors make the difference.
Annual contract turnover
The total value of work you expect to complete in the year sets the base premium, and many insurers adjust it to actual figures at the end of the policy.
Largest contract value and length
The maximum value and duration of any one contract you need covered. A single job above that limit needs agreeing separately.
Type of work
Timber frame, basement work, demolition, heritage buildings and work over water are rated more heavily than routine masonry or fit out.
Site security and fire precautions
Hoarding, lighting, CCTV, immobilised plant and hot works permits all count, and larger projects, timber frame in particular, are often expected to follow the joint fire code.
Plant and tools values
Owned machines are rated on what they would cost to replace; hired-in cover reflects the peak value of hired equipment on your sites.
Claims and excess
Past theft and water damage claims weigh heavily. A higher excess, particularly for theft and storm, can bring the premium down.
What contractors' all risks insurance does not cover
Most disputes on CAR claims come back to a short list of exclusions. These are the ones to read first.
- The cost of replacing a defective part itself, whether the fault is in materials, design or workmanship; how much resulting damage is paid depends on the defects clause
- Errors in design, which need professional indemnity insurance if you design or specify
- Liquidated damages your client deducts because the project overran
- Existing buildings you are working on, unless declared and agreed; under many contracts the client insures these
- Wear and tear, rust and gradual deterioration of plant and materials
- Vehicles used on the road, which need commercial vehicle cover or a fleet policy
- Unexplained shortages found at a stock check, and theft where site security conditions were not met
Contractors' all risks or public liability?
Contractors often assume their liability policy covers damage to the job. It does not. This is how the two divide.
| Feature | Contractors' all risks | Public liability |
|---|---|---|
| What it protects | The works, materials and plant on your site | Other people and their property |
| Typical claim | A fire destroys a half finished timber frame | A falling scaffold board injures a pedestrian |
| Who claims | You, or you and the client together | A third party who holds you responsible |
| Priced on | Contract values, plant values and the type of build | Turnover, wage roll and the trades you carry out |
| In the building contract | Insurance of the works clause, often in joint names | Indemnity and insurance against injury and property damage |
How to compare contractors' all risks insurance
Brokers place CAR faster when they can see your contracts and your typical site. This is what to have ready.
Check what your contracts require
Note which party insures the works, whether joint names are needed and any minimum sums insured or excess limits.
Set your contract values
Your expected annual turnover, the largest single contract and the longest build period, including any defects period.
List your plant and tools
Owned plant with replacement values, and the highest value of hired-in plant you hold at once.
Describe your sites
Type of construction, any work on existing structures, security arrangements and fire precautions such as hot works permits.
Compare the detail
Look at the defects clause, theft and storm excesses, materials off site limits and the defects period cover, not only the premium.
Starting a new contract?
Share your contract values and type of work, and a construction broker will compare CAR terms for you.
Compare CAR quotesContractors' all risks insurance FAQs
How much does contractors' all risks insurance cost?
It depends mainly on your annual contract turnover, your largest contract value, the type of construction and how well sites are secured. Owned and hired-in plant add to the premium. A broker can compare annual policies and show how the excess and limits change the price.
Is contractors' all risks insurance compulsory?
No single rule makes it compulsory, but most building contracts require the works to be insured and say who must arrange it. Clients, funders and main contractors often ask to see CAR before work starts, so in practice it is often a condition of winning the job.
What is the difference between annual and single project CAR?
An annual policy covers every contract you start in the year, up to a maximum value and length per contract. A single project policy covers one named build for its whole duration and suits large, long or unusual projects that fall outside an annual limit.
Does contractors' all risks cover defective workmanship?
Not the cost of putting the faulty work right. Most policies exclude the defective part itself but may cover damage it causes elsewhere in the works. How far that goes depends on the defects clause, so it is worth asking the broker which one each insurer offers.
Who insures the works under a JCT contract?
It depends on the insurance option in the contract. For new buildings, the contractor insures the works in joint names under Option A, or the client does so under Option B. For work to existing buildings, Option C usually has the client insure the existing structure and the new works in joint names.
Does CAR cover theft of materials and tools from site?
Usually yes, provided the site met the security conditions in your policy, such as locked containers, secure fencing and immobilised plant. Theft claims often carry a higher excess, and unexplained losses found at a stock check are normally excluded.
Does the policy cover plant I hire in?
Only if a hired-in plant section is included. It covers your responsibility for damage to or theft of hired machines and often the hire charges you keep paying while a replacement is found. Hire companies usually ask for proof of this cover.
Can I get CAR for refurbishment of an existing building?
Yes. The new works and materials can be covered, but damage to the existing structure is often excluded or limited. Under many contracts the building owner insures the existing structure, so check the contract and tell the broker exactly what you are working on.
How do I get a contractors' all risks quote?
Send your details through the quote button and a broker who arranges works cover will follow up. Expect questions on annual contract turnover, your largest job, construction methods, plant values, past losses and the insurance clauses in your contracts.
Ready to compare contractors' all risks cover?
Works, materials and plant insured from first delivery to handover, arranged by brokers who understand building contracts.