The glossary of construction and erection insurance – in alphabetical order, with plain-language explanations. The definitions are for orientation only: the legally precise meaning always comes from the given insurer's wording. The pocket edition (15 terms in minutes) is here; the trilingual version is the EN–DE–HU mini-dictionary.
- Around 30 key terms from the CAR/EAR world, in alphabetical order.
- Plain-language explanations, plus a warning about the typical misunderstanding where it matters.
A–I
All-risk: a cover logic in which the exclusions are listed – whatever isn't excluded is typically covered. Annual open cover: a contract covering the company's jobs that start during the year, according to notification rules. CAR (Contractors' All Risks): all-risk insurance for building works. Claim notification: its primary route is the insurer's claims line or online portal. Contract works: the work carried out plus the materials built in and on site – the subject of the property section. Deductible: the part of a loss borne by the policyholder – it can vary by type of loss. EAR (Erection All Risks): all-risk insurance for erection works, with testing-and-commissioning cover that's typically time-limited. Endorsement: a numbered addition to the wording – the language of tailoring cover. Exclusion: a risk or type of loss taken out of cover – the list is part of the genre's definition, not small print. Existing property: the already-standing building (or part of it) affected by the works – it can be brought into cover with a separate extension. Insured: the one whose financial interest the contract protects – for CAR, typically the principal, the main contractor and the subcontractors brought in together.
L–R
Liquidated damages: a contractual penalty – never an insurance claim. Loss mitigation: preventing a loss from spreading – typically a contractual duty, with its reasonable cost typically covered. Maintenance extension (maintenance cover): the cover bridge for the post-handover period – its content depends on the wording, with two typical levels. Maintenance period: see maintenance extension. Natural perils: storm, hail, cloudburst, lightning, snow, flood – the main adversaries of an open construction site. Partial handover: handover of one part of the works – cover typically closes section by section. Period of cover: the period during which the insurer stands behind the risk – typically from taking possession of the site to handover. Policyholder: the one who takes out the contract and pays the premium. Property section (Section I): cover for the works under construction and the related property. Proportional settlement (average): the loss is settled in the ratio of the sum insured to the real value. Recourse: the insurer's right to reclaim from the party that caused the loss – it applies when the party at fault is outside the circle of insureds.
S–U
Section: a self-contained part of the policy with its own limit (Section I property, Section II liability). Site: the primary location of the period of cover – defined in the policy. Storage and transit extension: cover for storage away from the site and for transport. Sub-limit: a smaller cap set for a particular type of loss within the main sum insured. Sum insured: the ceiling of the insurer's liability – it should match the works' full reinstatement value. Temporary works: structures serving construction that aren't built into the works (scaffolding, formwork, shoring, site cabins). Testing and commissioning: EAR's delicate period – testing the equipment under load before handover. Third party: someone outside the project's circle of insureds. Third-party liability section (Section II): cover for material and personal injury losses caused to third parties. Under-insurance: the sum insured is below the real value – the typical consequence is a proportional settlement.
Missing a term? Feel free to let us know – the glossary is a living document, and at the consultation any term can also be explained in the context of your own project.
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