Insurance Backed Guarantees

Why Do Customers Need An Insurance Backed
Guarantee?

Insurance Backed
Guarantee Leaflet

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Thousands of contractors, large and small, cease to trade each year for a multitude of different reasons. Guarantee periods can be as long as 10-15 years in some industries and much can happen to any business in that time, regardless of current stature. This is particularly true in today’s volatile business environment.

If your chosen installer were to cease trading you could be left with faulty goods, a guarantee of absolutely no value and a potential bill of thousands of pounds to rectify your problems.

Using a QAA installer that has in place an Insurance Backed Guarantee facility can help give customers peace of mind and overcome these potential problems.

Why Do Contractors / Installers Need To Offer An Insurance Backed Guarantee?

Customers are becoming more cautious. Businesses are failing at an alarming rate. Suppliers can take deposits and go out of business before the product or service has been delivered. Money can easily be lost. Suppliers can no longer be relied upon to be in business in 2, 5 or 10 years and still be there to service their guarantees! Customers need to feel some reassurance that the supplier they are dealing with has protection in place should they cease to trade. It is only right and proper that their guarantee should be honoured. In this environment, any contractor who does not offer this protection to their customers is doing them a disservice. Many of their competitors will start to put this protection in place. Therefore, contractor’s without this facility will start to lose business. Simply put, contractors will need to put this in place to secure contracts in the future and give themselves and customers peace of mind.

What Is An Insurance Backed Guarantee?

An Insurance Backed Guarantee or IBG is an insurance policy that is issued to the customer to underwrite a supplier's guarantee. Put very simply, this means that should a supplier cease trading and no longer be in a position to honour their original guarantee, should a problem occur under the terms of the original guarantee, the claim would be met by the insurers. Using a QAA installer that has in place an Insurance Backed Guarantee can help give the customer peace of mind and overcome these problems.

What Is Deposit Protection Insurance?

Customers are often asked to pay a deposit when they place orders for home improvements. This is normal practice for most installation companies as this helps safeguard them against manufacturing products they probably will not be able to use elsewhere should the customer cancel the order. However, some people find themselves having paid deposits only to discover the company ceases to trade before the installation has begun. In these cases, most times, the customer loses their deposit and is in the unfortunate position of having to find another contractor and negotiate a new price and pay another deposit before the work can commence.

Using a QAA installer that has in place deposit indemnity protection can help give the customer peace of mind when handing over deposits .

What Can Normally Be Covered By An Insurance Backed Guarantee?

• Workmanship by the contractor*
• Materials used by the contractor*
• Recovery of deposit payments made to contractor (usually up to 25% of the contract value)*
• Assistance in finding a new contractor to commence the project if the original contractor fails to start*
• All of the terms provided under the contractors guarantee should they cease to trade upon completion of the project*
• Transfer of the policy to any new owner of the property provided the contractors guarantee is also transferable.*

* All the above points are subject to the insurers master policy, the type of trade and if deposit protection is named on the insurance certificate/ documentation. Any questions on these points should be directed to the insurance provider.

How Credible are IBG's Supplied By QAA Partners?

QAA, through its partner organisations, can supply many types domestic and commercial warranties to underwrite many types of guarantees. Insurance Backed Guarantees supplied by QAA supply partners are H.M Treasury regulated and conform fully to criteria and guidelines set by:

DTI - Department of Trade and Industry
ABI - Association of British Insurers
FSA - Financial Services Authority
OFT - Office of Fair Trading

The guarantees range from 1 year to 10 years, depending on the type of work done.

Types of Work Covered

All the categories below can be covered for domestic or commercial installations. Customers should request an IBG if they are getting work done in the categories below. They should also ensure that they receive the relevant paperwork and Certificate of Insurance from the administrators.

This list is liable to alter from time to time depending on underwriters instructions and therefore all QAA members must obtain written approval before offering IBG's to customers. Types of work covered at time of publication include:

To Find Out More About Insurance Backed Guarantees
Tel: 01257-270700 or Email:Enquiry Form