The government is open to exploring new insurance coverage options for contractors after the Malta Developers' Association last week described the insurance provisions of the new contractors' licensing regulations as weak, the planning minister said on Wednesday.
Speaking to Times of Malta, Zrinzo Azzopardi explained that the regulations oblige contractors to have every project insured or to ensure that every construction project they are working on is insured.
"Following MDA's comments, the discussion now is about what type of insurance should be in place. We will continue to discuss that and update the law according to the most suitable insurance policies that become available on the market.
"We are open to considering other policies that can be included in the law."
The legal notice governing licences for construction contractors was published last week and states that all excavation, demolition and construction contractors will have to be licenced by 2025 in order to operate.
Those found operating without a licence face fines of up to €50,000 and prison sentences of up to six months.
While an initial draft of the regulations stated that contractors would need to have insurance policies in order to operate, the law introduced last week modifies that requirement.
Rather than making insurance a prerequisite, the law states that contractors must ensure works they carry out are covered by an insurance policy. This means they are bound to acquire an insurance policy for every project they work on or ensure that the project is already insured.
However, the MDA's argument is that an insurance policy should be a prerequisite for licensing, meaning contractors would be unable to legally operate unless they obtain a valid insurance policy.
The association said the proposed law will allow contractors to get a licence without being insured first and that it was "unthinkable how in the face of the recent events regarding deaths in the construction industry, the government chose not to introduce this obligation on anyone wanting to operate as a contractor".
Despite a growing number of construction site incidents, collapses and deaths, authorities have been slow to act to regulate the sector. The government first pledged to introduce a licensing regime for contractors in 2019, but the plan was kept on the backburner until the death of 20-year-old Jean Paul Sofia in a construction site collapse spurred authorities into action.