Why Insurance Is Crucial in Construction and Property Deals – And What to Watch For

Whether you’re breaking ground on a new development, purchasing a commercial asset, or managing a growing property portfolio, insurance is often seen as a checkbox – when in reality, it should be a strategic priority.

At Mortimer Street Capital, we work closely with developers, investors, and property owners who are laser-focused on numbers: costs, margins, funding terms, and timelines. Insurance, however, is the silent safeguard that protects all of that. Without the right coverage, deals can stall, funding may be delayed, and, worse still, value can disappear in an instant.

Here’s why it matters – and what smart operators are doing to stay protected and ahead of risk.

Construction Insurance – More Than Just a Builder’s Obligation

If you’re embarking on a development, refurbishment, or fit-out project, you’ll likely require a tailored suite of insurance solutions, including:

• Contract Works Insurance – to protect against damage or loss during construction
• Public Liability & Employer’s Liability – to cover third-party injury and staff/contractor liabilities
• Non-negligence (Party Wall) Cover – essential when working near adjoining buildings
• Rights of Light Insurance – to protect against potential injunctions or compensation claims from neighbouring properties due to loss of light
• Latent Defects Insurance (Structural Warranty) – to cover undiscovered construction faults that emerge after completion, often required by lenders or future purchasers

Rights of Light and Latent Defects policies are increasingly seen as critical tools for de-risking a scheme – particularly in dense urban settings or where exit strategies include refinancing or sale. They provide long-term protection and can preserve both project momentum and asset value.

Property Insurance – For Investors, Landlords & Owner-Occupiers

Once acquired or completed, the property needs to be adequately protected. Whether it’s a single asset or a portfolio of residential or commercial units, comprehensive property cover is vital to:

• Secure lending – policies must meet strict lender requirements
• Safeguard cashflow – through loss of rent or business interruption cover
• Mitigate ongoing risk – through property owner’s liability, legal expenses, and malicious damage cover

For owner-occupiers operating trading businesses from the premises, commercial combined policies may be necessary – covering buildings, contents, stock, and operational liability in one.

Why an Integrated Finance & Insurance Approach Works

We often see delays caused by insurance misalignment – either the wording doesn’t meet lender conditions, or the policy is arranged too late. That’s why Mortimer Street Capital integrates both finance and insurance advice from day one.

Our collaborative approach ensures policies:

• Comply with lender requirements for drawdown or exit
• Are tailored to the project’s actual risks and stages
• Cover all critical exposures – known and unknown
• Avoid duplicated or unnecessary premiums

Let’s Talk Risk Before It Becomes a Problem

Insurance shouldn’t be an afterthought. Whether you’re planning a project or already managing a portfolio, we’re happy to review your current position, flag potential blind spots, and help you align coverage with both lender expectations and long-term risk.

Get in touch to discuss how we can support your funding needs.