JCT 21.2.1 Insurance Cover

(JCT 19(2)(a) JCT 6.2.4 & JCT 6.5.1)

JCT Clause 21.2.1 Insurance (otherwise known as “non-negligence cover”) provides cover against liability for loss or damage to property being worked on and adjacent or surrounding property. The policy cover is extended to include work that is carried out by a contractor or subcontractor.

What does non-negligence insurance cover?
JCT 21.2.1 Insurance protects against expenses, liability, loss, claim or proceedings which may arise as the result of an injury or damage to any property which is not directly attributable to a negligent act. Often this type of problem arises out of work involving demolition, excavations, piling or underpinning as this can lead to damage to neighbouring properties including subsidence, heave, vibration, removal or weakening of support or lowering of groundwater.

The joint contracts tribunal 21.2.1 insurance cover protects you for damage that has not been caused by the negligence of the party carrying out the work. JCT Clause 21.2.1 Insurance is bought in addition to Liability and Contract Works cover. This is because a Public Liability policy only provides insurance protection against losses which arise from damage that results from negligence.

Why do I need Non-Negligence Insurance?
In the absence of negligence being proven, a Public Liability policy will not make a payout. JCT 21.2.1 Insurance is available to ensure that the policyholder is covered if the damage is caused to the building or neighbouring property by Collapse, Subsidence, Heave, Vibration, Weakening or removal of support or Lowering of groundwater because the building work has taken place. The policy will only pay if the damage was not foreseeable.

Does a Non-Negligence Policy Need to be in Joint Names?
In some cases, a JCT Clause 21.2.1 contract will require the JCT 21.2.1 Insurance policy to be in joint names between the property owner and the main contractor. The contractor will be responsible for arranging the JCT Insurance policy, paying the premium and complying with the policy conditions. However, the cover provided by the JCT 21.2.1 Insurance policy is solely for the benefit of the property owner.

What is Party Wall Insurance?
Party Wall Insurance is another name for Non Negligence cover.

Will Non-Negligence Insurance cover the costs of negotiating a Party Wall Award?
No. This cost is not insurable. The policy does not provide cover for legal expenses arising out of neighbour or party wall disputes. It is also not designed to meet the costs of agreeing to a party wall award or the award itself.

Forms & Fact Sheets

Proposal Form