What does Builder’s Risk Insurance cover?

Builder’s Risk Insurance is a specialized insurance cover that protects buildings that are either under construction or under renovation. Also called Course of Construction Insurance, it is ideal for protecting owners and general contractors for on site dangers.

Builder’s Risk coverage provides a buffer against damage – be it natural factors or construction errors. Builder’s Risk Insurance covers materials in transit or on site, equipment and temporary scaffolding. As a matter of fact, the contractor coverage also covers labor costs.

Is Builder’s Risk Insurance ‘all-risk’?

During construction, there can be expensive damage to your materials, temporary structures and equipment. Builder’s Risk Insurance covers this too. However, you may need to specify exactly what you need when you draft the policy. This is because some Builder’s Risk insurance covers all types of temporary structures on site, while others stipulate the cover for exactly what kind of structures.

Here’s a list of some of the things that may need you to pay added premiums for — before signing up for your policy, find out everything that is covered from the agents at Builder’s Risk.

• The foundation of the building.
• The equipment used for construction or renovation
• Any underground plumbing
• Scaffolding, fencing, trailers or stores – Any temporary structures used
• Materials that are in transit or stored away from the construction site
• Building materials that are onsite

Does Builder’s Risk Coverage Provide Indemnity Against All Types Of Damage?

When it comes to Builder’s Risk Insurance, you need to be aware of the exact provisions of the cover. This cover changes from coast to coast – with most ocean-side constructions having limitations of damage caused by wind and water.

Let’s take a look at the dangers covered by your Builder’s Risk Insurance cover.

1. Natural Disasters

Natural disasters come in the form of windstorms, hurricanes, lightning, floods and fires. This type of insurance covers such disasters – although you may have to pay more in premiums based on your geographic location.

Example: As a general contractor, you’ve started building a two-story building. The foundation is almost complete when there’s a flood which destroys it completely. You’ve already spent quite a bit on the foundation, but you need to start again.

In this case, your Building Risk Insurance cover will compensate you. You’ll be sorted not only for the materials used but also the labor charges spent and the cost of cleaning up the debris.

2. Theft and Vandalism

There’s a greater risk of theft and vandalism when it comes to construction sites in high-crime areas.

Example: You’ve started construction on a parking site in a high-crime area and are almost nearing completion. One night, thieves enter, vandalize the place and make off with all the equipment onsite. This is where your Builder’s Risk insurance cover comes in. The worth of the equipment stolen is noted and the amount reimbursed to you under your contractor coverage.

3. Vehicles and Aircraft

Vehicles and aircraft can pose a significant risk to construction sites.

Example: As a general contractor, you’re overseeing all the aspects of building a hotel near a small airfield. As the foundation has been laid and the framing started, there is quite a lot of equipment onsite. Suddenly, a plane with engine failure crashes on the site and causes widespread damage.

The cost of labor, materials and equipment destroyed as well as the debris cleanup charges are reimbursed to you through Builder’s Risk Insurance – Now you can start reconstructing.

Get Builder’s Risk Insurance Today