Builders Risk

Builders Risk coverage protects against damage to or destruction of buildings or other structures during their construction and possibly for a specified time afterward. It can cover just the structure, or also the materials on site waiting to be installed. The limit of coverage should accurately reflect the total completed value of the structure (all material and labor, excluding land value).

Damage typically can be a result of one of the following events:

  • Fire
  • Wind
  • Theft
  • Lightning
  • Hail
  • Explosion
  • Vandalism
  • Vehicles/Aircraft

Standard Exclusions may include:

  • Earthquake
  • Employee Theft
  • Water Damage
  • Weather damage to property left in the open
  • War
  • Contract Penalty
  • Voluntary Parting
  • Mechanical Breakdown
  • Damage resulting from faulty design, planning, workmanship, and materials

Some policies may cover loss of income and/or extra expenses resulting from damage to covered property. By endorsement, builders risk policies can be extended to cover soft costs such as additional real estate taxes, advertising expenses or legal fees that result from a physical loss to a building project.

Builder’s Risk insurance policies can be written in terms of three months, six months, or twelve months.

This coverage should be purchased BEFORE construction has begun.

Anyone who has a financial interest in a construction, remodeling, or repair project needs this coverage.

Be sure to read the policy carefully to understand all coverages, limitations, and exclusions.