Legal tip 234. Building defects Part IV. Compulsory Insurances for building defects
Tuesday, February 23, 2010 @ 8:38 AM
The system of guarantees for the building work is regulated in Article 19 of the General Building Act. They are legally compulsory for the developer finisihing a development.
For one year:
Property damage or liability insurance to guarantee, for a year, compensation for material damage arising from construction defects affecting elements of termination or completion of the building, which may be substituted for the retention of a 5% the amount of execution of the work. The insured sum insured will be of 5% of the final cost of the work, including professional fees.
For three years:
Property damage or liability insurance to guarantee, for three years, compensation for material damage due to defects or vices which affect the habitability of the building. The insured sum is of 30% of the final cost of the work, including professional fees.
For ten years:
Property damage or liability insurance to guarantee, for ten years, compensation for material damage from construction defects or defects that affect the foundation, supports, beams, floors, walls or other load-related or building elements related to structural stability. The insured sum will be of 100% of the final cost of works, including professional fees.
No public deed of new work will enter the Land Registry if it does not prove the constitution and full payment of the above guarantees (Art. 20 of the General Building Act).
You can check on the existence and details ( Insurance Company) in the Land Registry.
Part I of this serie here
Part II of this serie here
Part III of this serie here