The schedule slips, the client adds scope, material prices move – the construction project is alive, and that's normal. On the cover side, one thing isn't normal: if the insurer hears about all this for the first time at claim stage. Change notification isn't bureaucracy, it's cover maintenance – and the good news is, once it's a routine, it's a matter of minutes.
- What typically needs reporting: a slipping deadline, a rise in value, a change in technical content, a new risk element.
- The timing rule: before the change takes effect – an extension before the policy expires.
- The typical consequence of an unreported change: a loss outside cover, or a proportional (average) settlement.
- The routine: tied to project-control events, with one person responsible.
What needs to be reported?
The policy fixes the exact scope – the practical list has four items. Time: a change to the completion date (an extension!), a longer break in work. Value: a material rise in the project's value – extra work, price rises: sum insured article. Content: a new trade, a change of technology, an extra site. Risk picture: anything that affects the basis of the risk assessment – for example, an operating part of a building joining what was a greenfield job. In a doubtful case, the one-minute question is cheaper than guessing.
When and how?
The golden rule: before the change takes effect – the extension before the policy expires, the new trade before it starts. The form is typically simple: a written notification with the contract reference and the details of the change; as your broker, I carry this administration through to the insurer's confirmation. On the premium side, the change typically brings a proportional adjustment – that's the predictable cost of cover that moves in step with reality.
What happens if it's missed?
The two typical scenarios: the loss happens after the policy has expired (in a slippage) – in which case there's no cover at all; or the loss strikes works whose value has grown, while the old sum insured stayed the same – in which case under-insurance's proportional settlement kicks in. Both are the most avoidable type of loss: not bad luck, just administration that didn't happen.
Building the routine
Notification works best when it's tied to an event and a named person: at the end of every contract amendment and every coordination meeting, one question – "has time, value or content changed?" – and one name who flags it. The parallel tasks on the contractual/tender side (updating the certificate for the client) are carried further in the modification article; the full life cycle: timing article.
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