The Chamber of Architects and Civil Engineers (KTP) has echoed construction developers’ concerns about the failure to make insurance coverage a prerequisite to work as a contractor.
If insurers that make up the Malta Insurers Association are unwilling to issue policies to contractors, then authorities should explore “alternatives to local underwriters”, the KTP said.
It called for urgent discussions involving both the government and Malta Developers Association, which first raised the alarm about the insurance issue, to address the situation.
The KTP position effectively endorses that taken by the MDA over the weekend, which warned that a licencing regime for contractors introduced just one week ago would fall short of its stated aims because of its loose insurance requirements.
According to the new law, all contractors must have a licence by 2025 to be able to operate legally. Contractors will need to take out an insurance policy covering damages to third parties for each project they undertake and will not be permitted to start works unless they do so.
However, the MDA believes this is too weak a requirement and will do little to deter cowboy operators who decide to forge ahead with excavation, demolition or construction works without valid insurance.
Instead, the MDA has argued, insurance coverage should be a prerequisite to obtaining or renewing a contractors’ licence.
The development lobby has also argued that apart from third-party insurance, contractors should be required to take out employers’ liability insurance, to protect workers in case of workplace incidents.
The government has hinted that insurers are unwilling to provide contractors with blanket policies, saying on Saturday that they therefore had to “see what insurance products they can offer and adapt accordingly.”
In its statement on Monday, the KTP said that it considered the new licencing regime to be an “important milestone” for the construction sector, but warned that the insurance issue was a “serious lacuna”.
Requiring contractors to take out insurance for each individual project will add an unnecessary burden on the Building and Construction Authority’s enforcement personnel and on clients to verify that insurance was indeed taken out, it said.
“It is far more practical to ensure that adequate insurance cover is a prerequisite for the issuance of a licence, as is the case under the Periti Act which mandates that all periti must be covered by insurance prior to being issued a certificate to practise from the Kamra,” the KTP argued. “The presentation of a licence card should be sufficient proof of coverage for clients.”
It warned that the new licencing regime would be an “exercise in futility” unless the BCA proved itself be to be determined to bring rogue operators to heel.
Aside from urging authorities to adapt the insurance rule, the KTP also called for a timetable to broaden the licensing regime to include building services and finishing works in the medium-term.
Currently, licencing only applies to excavation, demolition and construction contractors.