🏗️ Builders Risk Insurance
Builders Risk is the core property coverage for structures under construction, renovation, or installation. It protects the project from physical loss or damage during the course of construction and is essential for owners, contractors, and lenders. Builders Risk is one of the most specialized and variable coverages in commercial insurance.
📘 What Is Builders Risk?
Builders Risk (also called Course of Construction coverage) is a temporary property policy that insures a building or structure while it is being built, renovated, or repaired. It covers materials, supplies, equipment, and labor invested in the project.
Coverage typically ends when the project is completed, occupied, or accepted by the owner.
📦 What Builders Risk Covers
Builders Risk policies generally insure:
- Structures under construction
- Materials and supplies on-site, in transit, or temporarily stored off-site
- Temporary structures such as scaffolding, forms, and fencing
- Contractor’s labor and overhead invested in the project
- Soft costs (when endorsed) such as architectural fees or financing costs
🔥 Common Causes of Loss
Typical Builders Risk claims include:
- Fire or explosion
- Water damage from weather or plumbing
- Wind, hail, or storm damage
- Theft of materials or equipment
- Vandalism
- Collapse during construction
📄 Policy Structure
Builders Risk policies vary widely but often include:
- Project value (hard costs + soft costs)
- Deductibles tailored to project size and hazard
- Coverage extensions for debris removal, testing, scaffolding, and more
- Exclusions for design defects, wear and tear, or faulty workmanship
🤝 Who Purchases Builders Risk?
Depending on the delivery method and contract structure, Builders Risk may be purchased by:
- Owner (most common)
- General Contractor
- Developer
- Construction Manager
The decision affects additional insured status, deductibles, and claims handling.
🧩 Why Builders Risk Matters
Builders Risk is the backbone of construction property coverage. It protects the project’s financial investment, supports lender requirements, and ensures continuity when losses occur. Understanding Builders Risk is essential for anyone working with construction accounts or project-based insurance programs.
