Builder’s risk insurance, also called course of construction insurance, is a type of property insurance that covers property damage or loss during the construction of a new home or building. Builder’s risk insurance protects the builder, not the homeowner, and is typically required by the lender financing the construction project. If you have a financial stake in the construction project, you need builder’s risk insurance. It may also be required by a mortgage or construction agreement.
Builder’s risk insurance policies can vary between providers. To make sure you get the coverage you need, work with an insurance agent who specializes in builder’s risk insurance.
Who needs builder’s risk insurance?
Builder’s risk insurance is important coverage for anyone who is involved in the construction process. This includes builders, developers, contractors, and even property owners.
When multiple parties go in a construction project together, the general contractor may purchase builder’s risk insurance on behalf of all parties involved. However, it is important that each party understands their own level of risk exposure and determine whether or not they need to obtain builder’s risk insurance coverage for themselves.
What does builder’s risk insurance cover?
Builder’s risk insurance can help cover the cost of repairs or replacement if there is damage to the property during construction. It can also help cover the cost of delays if the project is not completed on time. builder’s risk insurance typically covers:
- The cost of materials
- The cost of labor
- The cost of permits
- The cost of renting equipment
- The cost of loss of income if the project is delayed
What doesn’t builder’s risk insurance cover?
Builder’s risk insurance generally does not cover:
- Damage caused by weather events, such as hurricanes, floods, and earthquakes
- Damage caused by poorly trained workers or faulty equipment
- Cost overruns due to poor planning or management
How much does builder’s risk insurance cost?
The cost of builder’s risk insurance depends on a number of factors, including the value of the project, the location of the project, and the type of coverage that is purchased. Builder’s risk insurance is typically a percentage of the total project value, with rates ranging from 0.5% to 2%.
Where can I get builder’s risk insurance?
There are a number of insurers that offer builder’s risk insurance. When shopping for builder’s risk insurance, it is important to compare policies and rates from multiple insurers to find the best coverage for your needs.
Some factors to consider when comparing builder’s risk insurance policies include the reputation of the insurer, their coverage limits and exclusions, and their claims processing times. When choosing an insurer for builder’s risk insurance, it is also important to consider the level of customer service provided. With the right builder’s risk insurance coverage, you can help ensure that your construction project goes smoothly and is completed on time. For more information on this type of insurance, be sure to speak with Bethany Insurance agents today at 909-414-2281 or visit their website at www.bethanyins.com.