How much does work damage insurance requested by banks cost?

The projects we decide to launch must be based on our capabilities and we must have the necessary knowledge to be able to carry them out successfully. Indeed, depending on the area concerned, the rules to be respected change but they are always established in the interest of all. When we have the ambition to carry out a project that is very expensive, we call on banks to request credit. The bank takes risks with its financial partners and is entitled to request compensation or insurance to ensure the project is carried out. This is what it generally does in the case of a real estate project where it requires the debtor to take out construction damage insurance . How much does it cost?

The amount of insurance

Banks have strict requirements so that they maintain from the debtor a guarantee of the smooth running of his project. Subscribing to this insurance is also in the interest of the debtor because it secures the completion of the project he aims to accomplish. It allows the latter to benefit from quickly available financing to manage possible repairs if this proves necessary. The price of work damage insurance  must be provided in the form of a contribution, the terms of which vary depending on the status of the debtor. When the beneficiary of the real estate project is an individual, the value of the contribution that he or she must make represents on average 6 to 7% of the total amount of the construction. If the beneficiary turns out to be a professional in the sector, the terms are more advantageous and are of the order of 1 to 3%.

The terms of the contract

Apart from the prices of subscribing to building damage insurance , several other terms are taken into account to determine the clauses of the contract. Indeed, the contract varies not only depending on the status of the beneficiary but also depending on the scale or cost of the project, the equipment and technicians necessary for its completion, the request or not for a specific soil study. . It is compulsory for all construction projects and the full amount of the contribution must normally be paid at the start of the contract. In the event that this is impossible for the debtor, payment is made in two stages at the start and at the end of the work.

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