NEC3 Option D: under amended SoCC 7 Bonds & Insurance, includes cost of procuring all risk Insurance. During cost verification it was found out that the insurance policy was not compliant to the contract such as;
1. The parties insured as per contract it should be in the joint name of the Contractor and Employer. The name insured in the policy provided was the other company of the Contractor.
2. The works insured was not the works in the contract. as per contract the works is to build a road, the policy covers building, tunnel, etc, but no mention of road.
In effect after 2 years the project was not covered by the insurance. When the client notify the findings the Contractor provided amended policy correcting the non compliant provision. is it correct to disallow the cost since the insurance does not cover the works for 2 years?
1. The parties insured as per contract it should be in the joint name of the Contractor and Employer. The name insured in the policy provided was the other company of the Contractor.
2. The works insured was not the works in the contract. as per contract the works is to build a road, the policy covers building, tunnel, etc, but no mention of road.
In effect after 2 years the project was not covered by the insurance. When the client notify the findings the Contractor provided amended policy correcting the non compliant provision. is it correct to disallow the cost since the insurance does not cover the works for 2 years?