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Contract Works (Insurance) Template for Saudi Arabia

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Key Requirements PROMPT example:

Contract Works (Insurance)

"I need a Contract Works Insurance agreement for a large-scale hospital construction project in Riyadh, with coverage starting March 2025, including specific provisions for medical equipment installation and testing phase coverage, compliant with Saudi healthcare facility requirements."

Document background
Contract Works Insurance agreements are essential risk management tools in the Saudi Arabian construction sector, providing crucial protection for construction projects against various risks and potential losses. This document type, specifically designed as a Contract Works (Insurance) agreement, must comply with both Saudi Arabian insurance regulations and Sharia law principles, operating under the supervision of the Saudi Central Bank (SAMA). It typically covers physical loss or damage to construction works, materials, and equipment during the construction period, including testing and commissioning phases. The agreement is particularly relevant for large-scale construction projects, infrastructure developments, and commercial constructions where comprehensive risk protection is essential. It includes specific provisions for the Saudi market, such as Takaful principles, local regulatory requirements, and standard construction practices in the region.
Suggested Sections

1. Parties: Identification of the insurer (Takaful operator), insured party (contractor), and any other relevant parties such as the project owner

2. Background: Context of the insurance requirement, including project overview and basis for the insurance arrangement

3. Definitions: Detailed definitions of key terms used throughout the policy, including technical construction terms and insurance concepts

4. Scope of Coverage: Detailed description of what is covered under the policy, including works, materials, and temporary structures

5. Sum Insured: Specification of insurance amounts, including contract value, materials, and additional costs

6. Premium and Payment Terms: Details of premium calculation, payment schedule, and consequences of non-payment

7. Duration of Coverage: Policy period, including construction phase, testing period, and maintenance period

8. Exclusions: Clear listing of situations and items not covered by the insurance

9. Claims Procedure: Step-by-step process for making claims, including notification requirements and documentation

10. Obligations of the Insured: Duties of the insured regarding risk management, safety measures, and notification requirements

11. Termination Provisions: Circumstances under which the policy can be terminated and the consequences

12. Governing Law and Jurisdiction: Confirmation of Saudi law application and dispute resolution procedures

13. General Conditions: Standard policy conditions including compliance with Sharia principles

Optional Sections

1. Extension of Coverage: Additional coverage options that may be included based on project specifics, such as third-party liability or professional indemnity

2. Cross Liability: Section needed when multiple parties need to be covered as separate entities

3. Advance Loss of Profits: Optional coverage for delayed start-up losses, typically required for large commercial projects

4. Terrorism Coverage: Additional section when terrorism risk coverage is specifically requested

5. Environmental Protection: Special provisions for projects with significant environmental risks

6. Testing and Commissioning: Detailed provisions for projects requiring extensive testing phase coverage

7. Defective Design Coverage: Extended coverage for design defects, typically for design-build projects

Suggested Schedules

1. Schedule A - Project Details: Detailed description of the construction project, including location, scope, and timeline

2. Schedule B - Sum Insured Breakdown: Detailed breakdown of insurance values for different aspects of the works

3. Schedule C - Premium Calculation: Detailed calculation of premium including any adjustments and payment schedule

4. Schedule D - Excluded Properties/Activities: Specific list of exclusions applicable to the project

5. Schedule E - Security Measures: Required safety and security measures for the project site

6. Schedule F - Claims Documentation Requirements: List of required documents and procedures for claims processing

7. Appendix 1 - Risk Management Plan: Detailed risk management procedures and requirements

8. Appendix 2 - Emergency Response Procedures: Procedures to be followed in case of emergencies

9. Appendix 3 - Subcontractor Requirements: Insurance and compliance requirements for subcontractors

Authors

Alex Denne

Head of Growth (Open Source Law) @ Ƶ | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents | Serial Founder & Legal AI Author

Relevant legal definitions



















































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Relevant Industries

Construction

Infrastructure

Real Estate Development

Energy

Industrial Development

Mining

Oil and Gas

Transportation

Healthcare Construction

Educational Facilities

Commercial Development

Residential Development

Relevant Teams

Legal

Risk Management

Operations

Finance

Compliance

Commercial

Construction

Project Management

Insurance

Claims

Contracts Administration

Technical Services

Relevant Roles

Risk Manager

Construction Manager

Project Director

Insurance Manager

Legal Counsel

Compliance Officer

Chief Financial Officer

Project Manager

Contract Administrator

Operations Director

Site Manager

Insurance Underwriter

Claims Manager

Technical Director

Commercial Manager

Industries








Teams

Employer, Employee, Start Date, Job Title, Department, Location, Probationary Period, Notice Period, Salary, Overtime, Vacation Pay, Statutory Holidays, Benefits, Bonus, Expenses, Working Hours, Rest Breaks,  Leaves of Absence, Confidentiality, Intellectual Property, Non-Solicitation, Non-Competition, Code of Conduct, Termination,  Severance Pay, Governing Law, Entire Agreemen

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