Builder's Risk Insurance

Business Insurance for Builder's Risk

Builder's risk insurance is a specialized property policy covering buildings under construction, renovation, or remodeling. This coverage protects the structure, materials, fixtures, and equipment at the construction site from damage or loss during the building process.

Why Your Business Needs This

• Construction sites face unique exposures that standard policies don't cover
• Materials and fixtures are vulnerable to theft before installation
• Weather can damage partially completed structures
• Lenders typically require builder's risk coverage for financed projects

What It Covers

Builder's risk insurance covers the building under construction, materials stored on-site or in transit to the site, permanently installed fixtures and machinery, temporary structures used during construction, and construction equipment at the site. Coverage typically includes fire, lightning, wind, hail, vandalism, and theft. Additional coverages for flood, earthquake, and soft costs like extended financing and permit fees can be added. The policy remains in effect until construction is complete or the building is occupied.

Who Purchases Builder's Risk Insurance?

Either the property owner or general contractor can purchase builder's risk coverage. The contract typically specifies who is responsible. The policy should name all parties with an insurable interest including the owner, general contractor, subcontractors, and lender as insureds or additional insureds.

How Long Does Coverage Last?

Builder's risk policies typically cover the project duration from groundbreaking through completion or occupancy. Coverage can be purchased for specific project terms or on an annual basis for contractors with multiple ongoing projects. The policy automatically terminates when the project is substantially complete or occupied.