Insurance guarantees much more than just a promise
April 21st, 2012
Insurance guarantees much more than just a promise
We are asked allot by clients about our guarantee scheme, the general queries being “what is an insurance guarantee?” “What does it cover”? and “how does this differ from your company guarantee and other guarantees?”
So here’s the answer’s….
Most remedial companies will provide a guarantee upon completion of their work with cover extending between 10 – 30 years for damp and timber repairs and 10 years for structural and water proofing repairs . In most instances this document will be a company guarantee, a promise by the company to the client that in the event a faults occurs with the work through workmanship or material choice, the company will return and correct any problems free of charge.
The guarantee will be honoured if the claim is made within the guarantee period and under the terms and conditions outlined by the company. If in the unfortunate situation the company ceases trading and the guarantee was not reinforced by a third party or provided independently from an insurance provider, the homeowner could find the company promise worthless.
Obviously no company intends on going out of business but we have to be realistic, this could happen to any company regardless of size, structure, financial status or credibility, companies can go out of business for many reasons.
Until the early 80’s company guarantees were standard, which after years of companies going bust on homeowners created a sense of worthlessness. Manufactures of chemical products began introducing guarantees for contractors under their own approved contractor schemes allowing contractors to apply for additional guarantee protection for the work they had undertaken supplied by the manufacturer they used. These manufacturer schemes are still around today and their contractors can be recognised usually by their approved contractor logo’s.
Basically what happens is, a contractor will apply to become approved by a manufacturer which will usually involve buying into an scheme, undertaking training courses and of obviously buying their products. Manufacturers then agree to cover work undertaken by the contractor however, only products sold by that particular manufacturer can be used and are covered by the guarantee. Therefore if you are using an approved contractor you are being provided a manufacturers guarantee in reinforcement of the contractors work and the manufacturers products.
This means your contractor will only be using products sold by that particular manufacture, which may or may not be the best or most suitable product for your requirements.
These types of guarantees are Not Insurance they are backed guarantees, a promise provided by a contractor backed by a chemical supplier or manufacturer (a double handshake). Insurance-backed guarantee companies and manufacturers are regulated by nobody therefore there is no compensation scheme, consequently there is no protection for the customer. Many manufacturers and guarantee companies have gone out of business, leaving customers with worthless pieces of paper.
In 1983 the GPT (Guarantee Protection Trust) was formed as a completely independent company, established by PCA (Property Care Association) members to provide fair, transparent insured guarantees protecting property owners from the inadequate guarantees then (and still) offered by other contractors and manufacturers today.
The Property Care Association formerly part of the BWPDA, is the leading trade body for structural waterproofing, wood preservation, damp proofing, flood remediation and structural maintenance in the UK. PCA members meet a number of strict criteria to ensure they meet the required standards including, qualified surveyors and approved financial status ensuring only the elite in the industry are approved accreditation. As such, part of the GPT criteria is only PCA members approved industry professionals can apply for GPI insurance protection.
The GPT (an FSA regulated company) organised insurance cover for all PCA members in specialist areas of building and construction. This is official insurance provided from an FSA regulated company and applicable to Insurance Premium Tax (IPT), a tax payable to the government on general insurance premiums which is currently 6%. If you are not paying IPT then it’s not insurance, and the guarantee you thought was insured is most likely to be backed.
Insured guarantees can be provided for up to 20 years for specialist timber treatment, damp proofing and remedial wall ties and 10 years for lateral restraint, structural repairs and water proofing work. The Financial Services Authority (FSA) have only approved long-term guarantees up to 20 years. Therefore if you have been offered a thirty year guarantee this, is Not official insurance and again is likely to be ‘Insurance backed’ by a manufacturer.
Official insurance provides protection for the homeowner for up to ten or twenty years, dependent on the type of work carried out and comes into force if your PCA contractor is no longer trading. GPI provides specialist insurance cover which relates to the property rather than the owner. So if you decide to sell your property the insurance is automatically transferred free of charge to the new owners, adding value to the purchase price and comfort in the ‘sellers pack’.
Only approved contractors are selected to offer insured guarantees such as Property Care Association (PCA) members. Members of the trade body that represents specialist contractors, manufacturers and surveyors who specialise in the remedial repair industry . Insurance guarantees cover products produced by all manufacturers provided they have been approved and tested for use meaning PCA contractors can choose from a wide range of products from various manufacturers ensuring the materials we choose are most suitable for your scenario and not used simply due to a contract and guarantee with a particular supplier.
When comparing GPI members with other contractors you must ask yourself who vets those contractors, who determines their technical skills, are they Health and Safety trained and are they good enough to be acceptable to an insurance company?
Dryfix Preservation Limited are Full members of the Property Care Association and approved to apply for Insurance Guarantees on behalf of our customers from the Guarantee Protection Trust and Construction Guarantee Services.
If your in need of professional advice or assistance please do not hesitate to contact us or visit our website; Dryfix Preservation Ltd “Yorkshires Leading Damp and Timber Specialists”
Many thanks
Russell Rafton
C.S.R.T. / I.S.S.E
Dryfix – Surveyor
