Construction professionals to face risk of housing claims for 17 years

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Homeowners are to be given up to 15 years to claim compensation from developers for substandard construction work in new builds and property refurbishments. The move will concern many property professionals who could therefore face contribution claims from developers for up to 17 years after working on a project.

The government’s plans to extend the time limit to claim compensation from six to 15 years have been published in the Building Safety Bill, which is currently making its way through parliament. The proposal is one of a number of measures planned by the government as a result of widespread concerns about building safety following the Grenfell Tower fire in 2017.

The government says the extension to the compensation period will be applied retrospectively, so residents of a building completed in 2010 will be able to bring proceedings against those responsible including developers until 2025.

Then Housing Secretary Rt Hon Robert Jenrick MP said: “The new building safety regime will be a proportionate one, ensuring those buildings requiring remediation are brought to an acceptable standard of safety swiftly, and reassuring the vast majority of residents and leaseholders in those buildings that their homes are safe”.

James Burgoyne, Divisional Director – Claims & Technical of Brunel Professions says the move is good news for homeowners, but warns that the measure has negative implications for professionals. “A contribution claim can be made two years after the defendant settles the original claim with the claimant. As such this element of the Building Safety Bill could see professionals facing contribution claims from developers up to 17 years on, which will not help a professional indemnity insurance market concerned with these exposures,” he said.

The Ministry of Housing, Communities & Local Government has published a press release on its website. Reports about the Building Safety Bill have been published by Housing Today and Mortgage Solutions.

Brunel provides a wide range of Professional Indemnity Insurance broking services to property professionals. Click here to find out more, or call Mark Sommariva on 0203 475 3275.