Contractors and property owners can financially protect a property while it’s under construction (or being renovated) with a builders risk insurance policy. builders risk insurance was created to provide protection against specific perils that construction sites can be subjected to. These perils include:
Builders risk insurance can be bought on a variety of different properties as well as, projects including:
– Residential remodeling projects – Commercial property construction projects – Residential brand new construction, both one-time home and multi home projects
Coverage Terms and Limits Builders risk insurance is not intended to offer similar amount of permanent protection against perils as a standard home insurance policy does. Instead, builders risk insurance can be underwritten and approved for brief periods of time, typically ranging from three to twelve months.
When setting limits for builders risk insurance policies, contractors and property owners should think about the estimated completed value of the structure. This will have the price of all materials present on the job site in addition to labor costs, after the investment in both labor and materials would be lost if the job site is damaged completely.
What is Builders Risk Insurance Doesn’t Cover
Builders risk insurance isn’t intended to cover liabilities caused by injuries or perhaps accidents to individuals on the job site. The policy provides no personal liability benefits and should thus be supplemented by proper liability coverage. Additionally, it does not provide benefits for workers that are hurt on the job, a benefit offered by a workers compensation policy. Builders risk insurance is not intended to guarantee the work of any contractor or perhaps pay damages for contractor negligence.
There are several acts of nature and male that builders insurance doesn’t cover, such as:
– Earthquake – Flood – Other water damage – Landslides or Mud – Employee theft – Acts of war – Government action, like worksite shut down because of codes violations – Contractual breaches