Builder’s Risk Insurance vs Homeowner’s Insurance

Builder’s Risk insurance for homeowners will give you protection for as little as 1% of the construction costs. A small price to pay for a huge amount of protection. You may have Home Insurance that you’re happy with, but is it enough for the risks that come with construction? Separate coverage is always worth considering.

Here, we’ll look at 4 situations where Builder’s Risk Insurance for homeowners beats out a typical private policy.

1.New Builds

This one may seem obvious, but sometimes new owners don’t realize Homeowner’s Insurance only covers finished buildings.  If your building has no lockable doors or windows, Builder’s Risk is the best way to protect the project’s materials and temporary structures.

2.Renovations

So, Homeowner’s Insurance doesn’t cover new builds. But, how about an addition to your property? The fact is, the risk of an unoccupied building is still present. Builder’s Risk is specifically designed around these hazards. 

For instance: while your roofer applies new shingles, the frame is exposed to the elements. Storms that don’t normally pose a threat could inflict huge damage. Water damage has risen to 10% of claims with more extreme weather patterns.

Builder’s Risk insurance protects against these damages and more, including wind, fire, lightning, and blackouts – whereas Homeowner’s Insurance does not.

3.Saving Money

For home owners overseeing low-cost jobs, Home Insurance and Contractor’s Coverage may seem like enough and Builder’s Risk Insurance can sound like an unnecessary hassle. However, it could mean saving 25-30% in insurance costs, depending on circumstances. This is because it’s a temporary policy that covers only the structures and materials during the course of construction.

Well defined Builder’s Risk Insurance for homeowners means not paying to cover things like electronics, clothing, or inhabitants that may be absent.

Your own Builder’s Risk policy protects against negligent work too, helping you easily make up for finacial losses caused by the contractor.

4.There Are Project Specific Risks

Unlike Homeowners insurance, Builder’s Risk is highly customizable.  First, you set the period, usually 6, 12, or 18 months. Typical home insurance has strict limits on renovation time – if any is allowed.  Secondly, Builder’s Risk can cheaply include extensions based on your particular project.

If your property is in California or Ohio, you can add an extension for losses caused by earthquakes. If you’re environmentally focused, there are add-ons to maintain clean air and replace or repair renewable energy sources damaged during construction.

Some perils are more likely than others. Home insurance just can’t be tailored as easily as Builder’s Risk. It covers a much wider range of possibilites, giving you less to worry about.

Builder’s Risk Insurance For Homeowners Makes Sense

Builder’s Risk Insurance for homeowners is a safer option than relying on your personal policy. You can be sure to get the best and cheapest coverage by speaking to our professionals. We can help you design a policy that includes all of the factors relevant to your project. Give Builder’s Risk a call at (855) 983 6095.