. Course of Construction Insurance

Builder's Risk

This coverage is designed for buildings while under construction.

For more information, please read below.

Builder’s Risk Insurance

A Course of Construction Insurance policy, or “Builder’s Risk” policy, is designed to provide coverage for buildings while under construction. It covers the value of the property being constructed until it’s either moved into, or ready for occupancy, the Contractor’s value in materials at the job site before being installed and materials in transit intended for the job.

The policy may be written to cover the whole structure for new construction or for rehab projects. It can also be used to cover a specific project such as a room addition, a kitchen remodel or a new deck.

What’s Typically Covered
A Course of Construction, (Builder's Risk) policy is a form of Inland Marine insurance. The basic perils such as fire, wind storm, lightning, hail, theft and vandalism are common. Limited coverage may be provided for structural collapse during construction.

Standard Exclusions
Earth movement, employee theft, “mysterious disappearance,” (loss without any proof), water damage, weather damage to property in the open, war, government action, contract penalty, voluntary parting and mechanical breakdown, aircraft, watercraft or automobiles.

Liability is Not Covered
Builders’ Risk insurance does not include coverage for Bodily Injury or Property Damage of others. Ask your Broker about how your General Liability insurance could protect you during construction.

What’s Typically Not Covered
Debris removal, mold, terrorism, and damage by insects or vermin, damage resulting from faulty design, planning, workmanship and materials, plants, trees or shrubs.

All Risk
Ask your broker about an All Risk policy. All Risk policies typically don’t exclude coverage for; fire, theft, vandalism, explosion, water damage, testing, mechanical or electrical breakdown and collapse.

Time Element / “Soft Costs” Coverage
Soft Costs are those expenses for the building process that are other than materials. Including reimbursement for losses caused by a delay in completion on opening of the project. Things like; real estate taxes, interest, consulting fees, legal, accounting and advertising and/or marketing, equipment rental, overhead, insurance, refinance charges and architectural & engineering expenses.

Claims are settled on an Actual Cash Value basis for Builder's Risk losses.

Who it Covers
The Named Insured of a Builder's Risk policy is usually the Contractor or Developer of the property. However, it could be that the building owner or homeowner is the Named Insured, if they are responsible for insuring the property while under construction. Just as you’d expect with a Property Insurance policy, a mortgagee or lien holder may be added as an additional insured.

Always ask your Broker about what’s covered on your specific policy, as this article is intended to give you a basic overview of what a Builder’s Risk, “Course of Construction” policy is about.

The above Sponsors may also offer GENERAL LIABILITY INSURANCE POLICIES such as:
construction insurance General Liability Insurance
construction insurance Artisan Contractor Insurance
construction insurance Contractors Workers Compensation
construction insurance Builders Risk Insurance and Course of Construction Insurance
construction insurance Commercial Auto Insurance
construction insurance Property Insurance
construction insurance Commercial Excess or Commercial Umbrella
construction insurance Construction Equipment Insurance
construction insurance Tools & Equipment Coverage
construction insurance Inland Marine
construction insurance Contractor License Bonds
construction insurance Contractor Bid Bonds or Performance Bonds

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