For the purposes of this Policy, the following definitions shall apply:

1. Policy

The Policy of Inherent Defects Insurance.

2. Building Contract

The contract or contracts for the design and construction of the Premises and the contract’s documents.

3. Certificate of Approval

The Certificate(s) issued by the Technical Inspection Service to the Insurer at the same time as or following practical completion under the Building Contract, and any supplementary certificate issued by the Technical Inspection Service to the Insurer to certify continuing integrity of the Premises in respect of any re-examination in accordance with the Operative Clause.

4. Occupancy Certificate

A permission to occupy the building to be issued by the concerned authority confirming substantial completion of the Premises.

5. Date of Inception

The Date of Inception will be the date shown on the policy schedule.

6. Total Sum Insured

The sum shown in the Schedule representing the full rebuilding costs of the Premises at the Date of Inception and/or adjusted in accordance with Clauses (7) and/or (11) of General Conditions.

7. Deductible

The first amount of any claim, as stated in the Policy Schedule, which remains at the Insured’s own risk and is not payable by the Insurer.

8. Inherent Defect

Any defect in the Structural Works or the Envelope weakening the strength and steadiness or stability of the Premises and attributable to a fault, error or omission in design, materials, geological investigation or construction which was undiscovered at the date of issue of the Occupancy Certificate.

9. Insurer

The Insurance Company that provides insurance services as per this Policy.

10. Insured

The party or parties named in the Schedule, their successors in title and their assignees (subject to Insurer’s agreement in writing) to the extent of their respective rights and interests in the Premises. For the purpose of this Policy, the Contractor shall be the Insured before the start of the Period of Insurance, and the owner of the Premises shall be the Insured during the Period of Insurance as stated in clause (3) of Article (3) of this Policy.

11. Contractor

Natural or juristic person licensed to undertake construction works, engaged pursuant to Building Contract, and mandated by the concerned authority to obtain Inherent Defect Insurance.

12. Damage /Loss

The cost of reinstatement of physical loss or damage of total or partial collapse, or destruction of Insured Premises caused by an Inherent Defect. 

13. Premises

The whole and each part of the Works at the address stated in the Schedule and which is the subject of:

•The Occupancy Certificate.

•The Certificate of Approval issued by the Technical Inspection Service attached to and forming an integral part of this Policy.

Comprising:

a. Structural Works

All internal and external load-bearing structures essential to the stability or strength of the Premises including but not limited to foundations, columns, walls, floors, beams.

b. Envelope

All works forming part of external walls and roofing of the Premises but excluding:

1. Moveable elements of external windows, doors, skylights.

2. External cladding unless it is essential for the stability of the building.

3. Equipment, Fixtures and Fittings.

c. Non Structural Works

All non-load bearing parts of the Premises other than those works described in Definition No 13 (b) and 13(d) including but not limited to floor coverings, ceilings, partitions, internal windows and doors,

d. Equipment, Fixtures and Fittings

All non-loading bearing parts of the Premises other than those works described in Definition No. 13 (c) above as Non Structural Works including but not limited to:

Electrical wiring and connections, all fixtures and fittings, all equipment and fixtures for the collection and distribution of gas, water, heating and ventilation. All permanent mechanical and electrical apparatus including boilers and similar plant included in the Building Contract irrespective of whether such equipment, fixtures and fittings are fixed to or incorporated in any part of the Structural Works.

e. External Works

All external non-structural works owned by the Insured and the subject to the Building Contract, including but not limited to pavement, cross-over, paved areas, pedestrian and vehicular landscaping and all external drains, sewers, pipes, cables, wires and other service media.

14. Technical Inspection Service

The party or parties appointed by the Insurer at the expense of the Insured, to provide such examination of plans, specifications, bills of quantities and other documentation in relation to the Works and such inspections as the Technical Inspection Service and Insurer shall require.

15. Works

The works completed under the Building Contract.

16. Waterproofing

Part of the Works serving to protect the Premises from the ingress of water of any kind originating externally to the Premises. For the avoidance of doubt, this definition does not extend to any part of the Works serving to protect the Premises against the effects of humidity or condensation.

17. Policy Schedule

The Schedule annexed to the Policy containing information required to be imbedded in the Schedule.