What Every Building Owner Needs to Know About JCT Clause 6.5.1 Insurance

Most building owners assume their contractor’s insurance will cover anything that goes wrong during a project.

That’s a dangerous – and often expensive – assumption.

Our friends at Edwin Coe LLP recently published an excellent legal breakdown of JCT Clause 6.5.1 – the non-negligence insurance clause buried in many construction contracts. It’s well worth a read for anyone operating in the built environment.

We wanted to unpack it further from the building owner's perspective – and explain why this seemingly niche clause could save you hundreds of thousands in the event of a claim.

What is JCT Clause 6.5.1 Insurance?

In simple terms, Clause 6.5.1 (previously known as Clause 21.2.1 in older JCT forms) is a contractual requirement for the contractor to procure non-negligence insurance.

It exists to cover damage that arises from the works without anyone necessarily being at fault – so long as the damage is caused by one of a set of predefined risks.

That typically includes:

• Collapse

• Subsidence

• Heave

• Vibration

• Removal or weakening of support

• Lowering of groundwater levels

This isn’t professional indemnity insurance. It’s not public liability. It’s a specific policy intended to protect the building owner from third-party claims when the work being carried out causes damage but no one has technically done anything wrong.

Why It Matters for Owners

The 1958 case of Gold v Patman and Fotheringham established that building owners can be held liable for damage to neighbouring property caused by works on their own site – even if no fault can be proven.

So, imagine this:

You’re undertaking refurbishment works. The excavation causes movement in the Victorian building next door. No one can prove negligence. But the neighbour makes a claim against you – and you’re on the hook for tens (or hundreds) of thousands in remedial works.

That’s precisely the scenario Clause 6.5.1 is designed to protect against.

The Risk Is Yours – Whether You Realise It or Not

While it’s often the contractor who procures the policy, the responsibility for ensuring it’s in place (and adequate) ultimately rests with the building owner or funder. And yet, it’s a clause that’s regularly overlooked, misunderstood, or brushed aside in contract negotiations.

That’s a problem.

Without it, you’re exposed to:

• Legal claims from adjacent property owners

• Delays while insurance disputes play out

• Potential hits to asset value or transaction timelines

What Should You Do?

1. Ask the question – Don’t assume this insurance is in place. Ask your project team specifically whether a 6.5.1 policy is being procured, and who the insurer is.

2. Check the exclusions – Many policies carry carve-outs or limitations that reduce their real-world usefulness.

3. Make sure it’s documented – If a claim arises or a buyer wants reassurance later, you need to be able to produce the policy fast.

4. Store it where it can be found – Platforms like Building Passport let you upload, tag and store critical documents like this alongside the rest of your building information – forever accessible, even years after project completion.

How Building Passport Helps

When it comes to managing project risk, the right insurance is only half the battle. The other half is making sure the documentation is actually accessible – not buried in someone’s inbox or lost in a chaotic folder system.

With Building Passport, you can:

• Upload and securely store insurance policies, contracts, and risk documents

• Tag and categorise them by project, building, or stakeholder

• Control who can access what – whether it’s your contractor, broker, or legal team

• Keep a permanent, auditable record that lives on long after the project is complete

In short: when the question comes, you’ll have the answer. Instantly.

Information Is Protection

Clause 6.5.1 isn’t just legal fine print. It’s an important part of de-risking your project – particularly in dense urban environments where adjoining property risk is high and the margin for error is low.

When something goes wrong, the best position to be in is this: the risk was understood, the policy was in place, and the evidence is at your fingertips.

That’s what smart, modern building management looks like.

Read the full legal breakdown from Edwin Coe LLP here:https://www.edwincoe.com/blogs/main/jct-clause-6-5-1-insurance-non-negligence-insurance

Disclaimer: This article is for general information only and does not constitute legal advice.