Builder’s Risk Insurance will protect your project from many things that go wrong in construction. Knowing how it works will help you get the right coverage for your projects. Learn why you need it, what it does, and where to get it.
Contractors Liability and Builder’s Risk Insurance provide you with different types of protection. If you are sued for causing property damage to another and/or causing them bodily injury, your Contractors Liability will assist. It is essential coverage because the cost of a lawsuit could be devastating to your company. Contractors Liability does not protect your project from many things that can go wrong during the course of construction. This is where Builder’s Risk comes in.
This insurance is customized according to your project. In general it covers the labor costs, tools, equipment and materials used in the construction process. It protects you from damage due to events like fire, theft and vandalism. Other events can also be included, as is needed by your project. For example you can be covered for the cost of debris removal if an accident occurs. Tailoring your policy to meet the needs of your project is very important.
In short you do not renew a policy – you get one for a specific project. A Builder’s Risk policy is a one-shot policy. It is term insurance that covers you for a specific time period. The policy start date should align with the start of the building process. The end date should be when the building is complete and ready for occupation. In general a policy is for 3, 6 or 12 months. Once the building is finished you need to get new property coverage. It is possible in some instances to extend your Builder’s Risk policy if your project is delayed.
There are many factors that determine the cost of a policy. These include:
The one with the biggest impact is the total value of the project. Builder’s Risk is replacement coverage so the value of the policy should be 100% of the replacement cost of the building at completion. The greater the value of the project, the greater the cost. Moreover, it is important to not undervalue the project as you will be underinsured. This will impact how much you are paid out in the event of a claim.
This is specialized coverage and it makes sense to get yours from a company that focuses on this type of insurance. At Builder’s Risk.net this is what we do. Our agents know the industry very well and can provide you with the best advice. Call Builder’s Risk at 877 960 0221 and get the right solution for your company.