What Does Construction All Risk Insurance Cover?
Construction All Risk Insurance (CAR) is a type of property and liability insurance designed for building projects in Latvia. Typical coverage includes:
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Construction works and materials
Protection for the building under construction and all materials on site.
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Machinery, tools, and equipment
Coverage for damage or loss of equipment used in the project.
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Debris removal
Costs of cleaning and removing damaged materials after an insured event.
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Natural disasters and accidents
Such as fire, storm, hail, flood, or vandalism.
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Third-party liability
Financial responsibility if the construction causes damage to other people or property.
What Is Not Covered?
Construction All Risk Insurance usually excludes:
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Poor workmanship or use of defective materials (not to be confused with poor quality)
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Delays, penalties, or loss of expected profits.
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Wear and tear of equipment.
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Errors in design, planning, or accounting (unless special coverage is added).
Why are these excluded?
Generally, insurance is meant to cover uncontrollable, accidental events. Defective or low-quality materials, poor workmanship, incorrect planning, or errors in design, planning, or accounting are considered within the client's control.
However, these issues can be insured with additional coverage options.
Are There Extra Coverage Options?
Additional protection can be purchased, such as:
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Professional indemnity insurance for architects and engineers.
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Underground works coverage for cables, pipelines, and foundations.
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Extended liability for subcontractors.
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Extra costs for overtime, night shifts, or transport after an insured event.
Austris Kokins, Member of the Board, PK Serviss LTD
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Why Does Construction Insurance Matter in Latvia?
Latvia’s construction industry faces unique risks:
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Harsh weather (snow, storms, flooding) can damage works in progress.
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Banks and financial institutions often require CAR insurance for project financing.
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Public procurement and large private projects may legally require insurance before work begins.
Why Work With an Insurance Broker?
Construction insurance policies are offered in Latvia by major insurers such as Balta, BTA, ERGO, Gjensidige, and If. An insurance broker helps you:
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Compare policies and find the best terms.
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Understand exclusions and hidden risks.
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Get assistance with claims.
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Access professional advice at no extra cost (the broker is paid through the insurer’s commission).
How can we help you?
Ready to make your next move? Contact our brokers and let us guide you through the insurance labyrinth.