ABSTRACT
Insurance is a widely used risk management tool to transfer to a third party specific risks that a contracting party is liable for. In practice, insurance does not always result in payment following the occurrence of an insured event. Instead of preventing disputes as to who is liable for the financial consequences of a risk event, in many situations the insurance itself provokes or complicates disputes. Chapter 23 discusses why insurance is important for construction contracts. It reviews the current insurance landscape for design and construction risks in Victorian construction projects. A number of problems that arise from the conventional approach to insurance for construction projects are identified. Different approaches to project insurance used in a large project and a civil law jurisdiction are discussed. The benefits that could flow from adopting these different approaches to make insurance more fit for the purpose for which it is intended, are outlined.
