What is the Purpose of Builders Risk Insurance?

There are always risks when you build a new project or renovate an existing one in construction. Someone steals the building supplies, weather delays construction or an accident causes malfunctions to the project. Builders risk insurance, then, is important because it protects your investment while construction is happening.

Then, what is builders' risk insurance? Why is it important?

What is Builders Risk Insurance?

Course of construction insurance which is also known as builders risk insurance, is designed specifically for buildings being constructed. Unlike other property insurances, you can only use builders' risk coverage during the stage when a construction is being built or renovated.

By adopting this policy, construction sites are protected against different risks and all parties involved are safeguarded from losing a lot of funds in case of trouble.

What Kinds of Losses Are Covered by Builders Risk Insurance Coverage?

Most often, builders risk insurance helps cover against:

• Fire and lightning
• Vandalism and Theft
• Wind, hail and various other kinds of weather damage
• Explosion
• Damage from a vehicle or an aircraft
• Building collapse due to specific reasons.

Some policies are designed to cover lost sales, rental income and extra interest on loans caused by delays in the project. As a result, your project and the level of coverage your insurance provides are in sync.

Why Builders Risk Insurance is Important

Here are major reasons why including builders risk insurance is essential when planning any construction job.

1. Financial Protection- Builders risk insurance can assist in recovering from losses quickly to avoid problems that last for a long time. Building is not cheap and if something goes wrong during construction and it is not covered, the project might have to stop.

2. Compliance with Contracts and Lenders

Most banks and institutions only fund construction loans if builders risk insurance is in place. Sometimes, the terms of the contract signed by property owners and contractors include requiring proof of coverage.

3. Peace of Mind- Knowing that your project is covered allows you to focus on budgets, timelines and quality rather than worrying about future problems.

4. Covers a Wide Group of People - Builders risk insurance policies might also include the people doing the work such as contractors, sub contractors and architects. Multi-party construction projects need all parties to work together for protection.

What is Excluded in Builders Risk Insurance

Being so comprehensive, builders' risk insurance does have exclusions. A lot of these policies do not provide coverage for:

• Employee theft
• Earthquakes or floods unless added specifically
• Wear and tear
• Mistakes in the design, planning or workmanship

To address these missing needs, you might want to get more coverages such as general liability and contractor’s equipment insurance.

Who Needs Builders Risk Insurance?

If you handle a construction or renovation project as a property owner, builder, contractor or developer, you should get builders risk insurance. It does not matter if the building is for commercial or residential use; all structures need to be protected during construction.

Collaborate with Dunbar Bedding Field

Our team knows that construction projects are not easy and how important it is to protect your investment at Dunbar Bedding Field. We design builders' risk insurance coverage that match your project requirements, no matter how big or small your construction is.

Protect your Project Today

Deal with any unexpected situation so it does not interrupt your construction progress. Get in touch with Dunbar Bedding Field to see how builders risk insurance will protect your project from the beginning until it finishes. We have skilled agents who are prepared to assist you in making solid choices.

You can get in touch with us now by calling or by filling out the quote request form on the web.