Builder’s Risk Insurance

Secure the site first, then document before anything is cleared. Photograph the damage in place, and keep the daily logs, the schedule, the subcontractor list, and the delivery tickets for materials that were on site. Do not demolish or rebuild the damaged work before it has been inspected, because the scope of the loss is measured on what is left. Track the added costs separately from the original contract cost. Tell us and the owner the same day, since most policies name several insureds who each have reporting duties.

Yes, builder’s risk is commonly used for renovation work as well as new construction. It typically covers the work in progress and the materials intended to become part of the project. Renovation policies differ in how they treat the existing structure, so if the existing building also needs coverage, that has to be arranged deliberately rather than assumed.

Not in the base form. That is soft cost and delay in completion coverage, added separately. The base policy pays to repair the damaged work. It does not pay the consequences of finishing late: extended loan interest, additional architect and engineering fees, permit renewals, real estate taxes, or the rent or sale proceeds that arrive months behind schedule. Those are funded by soft costs and delay endorsements, each with its own limit and waiting period. On a financed project the lender is often the party who cares most about this.

Usually everyone with money in the project, and the order matters. The owner, the general contractor, and the subcontractors each have an insurable interest, and a policy naming only one of them can leave the others arguing after a fire. Lenders normally require to be named as mortgagee or loss payee before they will fund a draw. Who buys the policy is negotiable and is usually set by the construction contract, so read that clause before anyone binds coverage. Send us the insurance section and we will match the policy to it.

Builder’s Risk Insurance typically does not cover injuries on the job site, employee theft, or liability claims. Those usually sit with General Liability Insurance and Workers’ Compensation. Builder’s risk forms also differ on testing, faulty workmanship, and delay, so the form written for your project is what decides those.