Builders Risk Insurance is designed for property owners, developers, contractors, and lenders involved in construction projects. The risks involved can be very different from those faced by an ordinary household or general business, especially when fire, theft, vandalism, weather, building materials, work in progress, and project delays are part of the exposure.

Coverage can be tailored to the individual situation. Peninsula Insurance Servicescan help clients in Michigan compare available options from multiple insurance companies and review differences in coverage, limits, deductibles, and eligibility.

Why Consider Builders Risk Insurance?

A building under construction presents a moving target from an insurance standpoint. The value of the project increases as work progresses, materials may be stored on-site or in transit, and a loss can occur before the completed property is eligible for a standard building policy.

Insurance can help transfer some of these financial risks, but no policy covers every situation. The appropriate combination of coverage depends on the specific details of the risk and the insurance companies willing to consider it.

Builders Risk Insurance Coverage Options

The coverage that may be appropriate varies by client. Depending on the situation, an insurance program may include several different policies or endorsements.

Building and Materials

Builders risk insurance may help protect the structure under construction and covered building materials that will become a permanent part of the project.

Materials in Transit or Temporary Storage

Depending on the policy, coverage may be available for building materials while in transit or temporarily stored away from the jobsite.

Debris Removal

A builders risk policy may include limited coverage for debris removal following a covered loss.

Soft Costs

Some policies may offer coverage for eligible additional expenses or soft costs caused by a covered project delay.

Equipment Breakdown Coverage

Equipment breakdown coverage may help with certain sudden mechanical or electrical failures involving covered equipment. It can be valuable for businesses that depend on specialized machinery to operate.

Builders Risk Insurance FAQs

When should builders risk insurance start?

Coverage is generally arranged before construction begins or before the insured has a significant property exposure at the site. Starting after work is underway can create underwriting complications.

Does builders risk cover materials stored off-site or in transit?

It may if the policy includes appropriate off-site storage and transit coverage. Limits and locations should be reviewed before materials are moved.

Does builders risk cover theft from a construction site?

Many policies may cover certain theft losses, but security requirements, exclusions, and treatment of tools versus building materials can differ.

When does builders risk coverage end?

Coverage can end at completion, occupancy, sale, expiration, or another event specified in the policy. Permanent property insurance should be coordinated before the builders risk policy terminates.