Give us a call
888.748.1930

What is Builder's Risk Insurance?

Existing buildings are exposed to a wide variety of threats—fire, flooding, and vandalism are just a few of the ways building structures can be harmed. However, buildings under construction aren't ready to face risks that completed buildings can withstand. There's also the chance of an accident during the construction phase, like materials being destroyed or installed incorrectly. A proper risk analysis from our Get A Policy Insurance Services agents can help reduce the number of threats a new construction faces, and our agents can help reveal additional threats that may need to be covered by additional policies.

Builder's risk insurance is a policy designed to mitigate the chance of loss and protect you in the event that damage is done to the building. This policy is most commonly purchased by landowners and those funding the project, although some contractors purchase it in order to have more control over how each job is insured.

This policy is mainly designed for new construction, rather than changes and improvements to existing buildings. That form of construction is usually covered by property insurance and does not need any additional coverage, although it's best to talk with an agent before starting any particularly large project just to be absolutely sure it's covered.

What Does Builder's Risk Insurance Cover? What Does It Not Cover?

Builder's Risk Insurance generally covers the owner, the lending institution, the contractor(s) performing the work, and other related parties. In addition to providing coverage for damage to the building itself, most plans also cover temporary constructs (like scaffolding), materials, and equipment being used (whether it's currently on-site or off-site). The majority of policies are written on an all-perils basis, which means that reimbursements are available for any losses except those specifically excluded.

Common exclusions from this coverage include (but are not limited to):

  • The value of the land itself
  • Employee theft
  • Damages beyond the estimated value of the construction
  • Any losses brought by law or ordinance changes
  • Damage from earthquakes
  • Losses from war, nuclear hazards, or actions by civil authority

As you can see, most of the exclusions are not likely to occur during the course of a normal construction project. The value of the land is the only one likely to change as new work is done, and you will likely need to account for any improvements or losses the next time your company prepares taxes.

Builder's Risk Insurance Policy Lengths

Most policies last until the building is no longer under construction. The exact point at which this occurs can vary—it may be when certain parts of the structure are done (but finishing work, like painting, has not been completed), up to the day it opens for business, or when the contract with the construction company ends. If you're worried about interim risks—like the building being damaged between when construction finishes and when it opens for business—talk to one of our agents and ask about extending your coverage.

 

1. "Threat/Vulnerability Assessments and Risk Analysis." WBDG. Accessed April 20, 2016. https://www.wbdg.org/resources/riskanalysis.php.

2. "Who Should Buy Builder’s Risk Insurance?" BuildingAdvisor. Accessed April 20, 2016. http://buildingadvisor.com/who-should-buy-builders-risk-insurance/.

3. "How Do I Account for Land improvements?" Questions & Answers - AccountingTools. Accessed April 20, 2016. http://www.accountingtools.com/questions-and-answers/how-do-i-account-for-land-improvements.html.

Our Location

Get A Policy Insurance Services

6305 Wesley Street, Suite 103
Greenville, TX 75402
Main office: 903-686-9545
Toll free: 888-748-1930
Fax: 888-902-1936

Our Providers

Testimonials

After 19 years of being with State Farm they decide to raise my rate 18% and I thought that was ridiculous. I turned to www.getapolicy.com and they insured my home for $308.00 less than I was paying with State Farm before my renewal. Gotta Love That! Special Thanks To Get A Policy.

R. Johnansen
When I was told this month that I was being forced to buy flood insurance…. even though I am nowhere near flooding creeks, lakes, etc…. I was not real happy about that. I called www.getapolicy.com and they made it so easy to understand and my premium was much lower than anticipated. Thanks Again

J. Castillo
Thanks Get A Policy.com for handling my renters insurance to meet the needs of my apartment complex. It was simple and I will recommend your service to others that live here in my complex.

J. Martinez
Get A Policy.com made buying flood insurance so simple. I submitted the quote and they contacted me within minutes with the rate. I bound and had a policy all in under 30 minutes. Now That Is Service!

Trevor P.
Thanks for saving our family $36.00 a month on our auto and renters insurance. We can use the extra money.

Aaron W.
I just wanted to let you know that the major repairs to my house have been completed. I had to talk to my inside property loss specialist several times because the final invoices and the proposals were not matching. Also more work and money needed. After 3 checks – all invoices were paid in full. I was expecting a huge hassle to recover the money but much to my surprise Safeco was very easy to deal with. A big Thank You to you as well. I can breath easier now. Happy Holidays!

Tammy H.
Just wanted to take a moment and THANK YOU again for PROACTIVELY going into my policy to look for discounts before we renewed. You saved us almost $100.00 a month and that is a lot for a family with 5 cars and 3 kids in College. We sure do appreciate how you take care of us with this personal touch.

Cheri N.
Could kick myself for not changing insurance companies last year! A big thank you to Jimmy Bubba Jenkins with Get A Policy.com! Highly recommend my old high school friend for insurance. He seriously just saved us about $2000 a year on our new home and auto policies for better coverage! Fast response too! Super happy and thankful for you dear friend!!

Cara K.