What is builders risk insurance?

Builders risk insurance can be complex and easily misunderstood, as coverage and policies vary from one insurance company to the next. But in a nutshell, builders risk insurance is property protection for your construction project, from start to finish.

It protects the building or structure, as well as any materials, supplies and equipment used in the course of construction. A builders risk policy can be purchased by the contractor, the building or business owner, or even a lender, and may also cover the architect or engineer involved.

Once your project is complete, your builders risk insurance policy would end, and you’d want to consider a commercial property insurance policy to continue protecting your investment.

How a builders risk insurance claim can impact you

Unfortunately, the “unexpected” happens more frequently than we’d like. Especially with construction projects. Having the right insurance can help alleviate the incredible financial burden of a claim.

Builders Risk: If it's Too Good to Be True, It Probably Is - M3 Insurance

What is (and is not) covered by builders risk insurance?

Just like every construction project is different, no two commercial builders risk policies are alike. Each policy has limitations, exclusions, and additional optional coverages that you’ll want to be aware of and have customized to fit your needs, before you break ground.

What is typically covered?

Building repair/replacement

Materials and supplies

Tools and equipment

Furniture and fixtures

Outdoor property

Debris removal

Property in transit or off-site

Damages from earthquakes (optional)

Damages from flood (optional)

Soft costs (optional)

What is not typically covered?

Accidental damage (i.e. dropping something)

Damages to someone else’s property

Intentional property damage

Wear and tear

Employee theft

Claims of bodily injury

Work-related injuries or illnesses

Builder's Risk Insurance: What Costs Are Covered in the Event of a Loss?

By Aban

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