As the national construction sector slips into a period of contraction, tradesmen and builders may be considering taking on new and unfamiliar work in other industries. However, individuals who take this step need to be cautious of their tradesman insurance requirements to avoid costly gaps in cover.
The Australian Industry Group (AIG) and Housing Industry Association released the Australian Performance of Construction Index (APCI) earlier this month (February 7) and the results show the sector slipped below the 50 point level that separates expansion from contraction in January.
Now sitting at 48.2 points, the APCI indicates employment, new construction orders and deliveries from suppliers are all expected to fall in 2014.
With this troubling housing construction market, builders and tradesmen could begin looking elsewhere for employment opportunities – following the direction of American workers in a similar environment.
“With limited amounts of work, contractors have been forced to change up their operations,” American-based Hartford Financial Services Group Vice President William Sullivan told global publication Business Insurance on February 24.
“So they’re going into new territories and working on new types of projects, which can really increase risk.”
This growth in risk can include working with people, tools, equipment and policies they are not familiar with. In particular, Mr Sullivan highlighted the issues associated with working with subcontractors or employees “who might not be fully trained. They also are working in territories that have a different claim legal environment”.
“They might say, “Hey, I always built buildings. I’m going to build a road now. I’m going to get into infrastructure” said Paul R. Becker, president of the construction division of Willis North America.
Contractors and tradesmen who decide to seek employment in a new field or industry need to keep their insurance provider advised to ensure insurers are aware of a new venture before a claim is filed.
It is also important to review your tradies insurance policy to make sure any work you perform is covered. For more information, contact Trades Insurance today.