Water intrusion in basement due to storm - insurance?

Good evening,

As a construction manager friend of mine told me, a construction insurance is mandatory for the contractor, and he has to ensure that his trades are protected until they are handed over. He still wants to find a reliable source or ask a specialist lawyer, but that will take some time, and we need the information quite quickly so that we can respond accordingly to the company before our vacation.

Right now, I don’t know whether to laugh or be annoyed...

Besides my main job, I prepare assessments of construction documents for clients. In this capacity, I have already reviewed many providers and their documents. Quite a few “recommend” their customers to take out builder’s liability insurance as well as a construction insurance (called construction performance insurance for several years now). So much for the claim that taking out construction performance insurance for each construction project is the duty of every contractor.

There are no exact regulations to become a construction manager in the single-family house sector; with many providers on the market, the client builder can already consider themselves lucky if the construction manager has learned a trade; ideally bricklayer or carpenter. Unlike construction supervising architects or engineers, most construction managers neither have commercial basic knowledge nor have they even remotely learned the legal part of house construction during their training.

Even if it needs to be clarified whose insurance applies (ours does not cover natural hazards, only from completion of the house) or which of the two parties (client or construction company) is responsible – how can that be clarified easily? The company denies everything, whether rightly or not. An insurance company also always tries to avoid responsibility, so I won't trust the statements – so where can one gain clarity here?

And you believe your construction manager friend for that? That’s an interesting logic you apply.

As I see it, you will end up bearing the damage incurred, unless your contract documents contain a note that your contractor took out a construction performance insurance for your project. And even then, it would have to be clarified under which contractual terms it was concluded and which exclusions have been agreed upon.

But – legal advice in Germany is exclusively reserved for the advisory professions, so consult a lawyer you trust.

Rhenish regards

The construction expert has already given the correct answer. Find yourself a lawyer.

However, I also think (warning: layman's opinion!) that normally, if at all, your construction performance insurance should cover that. Unless, as already said, your construction company has taken out construction performance insurance for your construction project. I don't believe that, though, because otherwise, you would probably know.

Regarding the damage itself, I can only advise you to get an expert on board who assesses the damage. Unfortunately, we also had such a problem during our construction phase. We also had water intrusion into the basement three weeks after the screed was applied. You can't believe how wet our floor was after the supposedly superficial water was gone. You can't manage that with dryers alone. In the end, the entire floor structure had to be removed again, i.e., screed, underfloor heating, and insulation, all electrical cables had to be renewed, and the wall plaster had to be renewed up to a height of 80 cm. And in the meantime, of course, everything had to be dried first. The whole thing cost us about 3 months of time and a lot of nerves.

I see 2 problems. One is the legal situation. I can't say anything about that. If I understood you correctly, then filling the property is your own work. And the plasterers have already removed the scaffolding, right? With that you could have filled....... So your argument in this direction does not work.

The bigger problem, which you might possibly underestimate, is the probable damage caused to the screed, floor structure, walls, etc. As someone already wrote, immediately consult external expertise!!

Fortunately, we don't have underfloor heating in the basement, and the electrical system, etc., was not damaged because thankfully the water did not rise that high. The real problem is just the moisture and the associated drying costs. We will indeed be stuck with those. However, if there were damage, the heating system could certainly be rejected.

The joiners had only just removed the scaffolding shortly before the flood occurred. The basement would have been finished a long time ago – we would even have been living there since April – if the company hadn't messed around like that. That's why I am so angry; none of this should have happened. Fortunately, the construction manager we brought in has enough expertise and experience to say that drying the screed is sufficient.

It's a shame that we now have to pay several hundred euros in electricity costs out of our own pockets and that the tiling of the basement is delayed.

I will definitely be wiser once the construction manager friend has spoken to the responsible lawyer of his company.

If you actually get by with a few hundred euros for the drying costs (electricity costs), you would have been very lucky. For us, the electricity costs for drying alone amounted to over €4,000.

Otherwise, just a few comments and notes from my side:
1. Is this your own appointed site manager or the one from the construction company? We also brought in a building biologist, and after our explanations, he was immediately sure that the floor structure would have to be completely redone because the moisture was also collecting under the screed. He was right because the measurements (there are special measuring devices that can measure moisture in the floor or walls) confirmed this. Additionally, mold was detected in all!!! adhesive tape samples, even though nothing was visible externally! Have you had the moisture measured at your place?
2. For us, the water level actually was not that high either, but the moisture rose up the walls to a height of about 50 cm, so (with a sufficient safety margin) the plaster also had to be removed and redone after drying the walls.
3. By the electricity, I did not mean the cables running in the wall, but those installed in the cellar floor (i.e., under the screed). Since our electrician could not be sure that no damage was caused to the cables, he demanded replacement; otherwise, our warranty would probably have been void.

I hope you are lucky and get by with the "moderate" additional costs for drying and that the rest proceeds to your satisfaction, because otherwise, if you are stuck with all the costs, this will be a very expensive "fun".

You wrote in the initial post about 15-30 cm of water. And that on bare screed. How do you come up with the idea that drying the screed is enough? Do you believe the screed is laid waterproof? I would definitely have the moisture UNDER the screed and in the wall at the floor checked! And independently. You will only get trouble later.