Know About Builder's Risk Insurance and Its Coverage

Buildings or any other structures which are under construction or renovation are prone to different risks. They are vulnerable to accidents and damages even after taking all precautions, following safety norms and standards. They may get damaged by heavy winds, fire or fall victim to unforeseen events that occur on a construction site and can disrupt your financial stability.

‘Builder’s Risk Insurance’, also called as ‘Course of Construction Insurance’ covers a building which is presently being constructed or renovated. It can also cover damages to the materials, which are to be installed or used at the construction site.

It is the building owner who is supposed to buy builder’s risk insurance. Sometimes, depending on the contract, a construction contractor may need to buy it. As a building owner, builder or a construction contractor, you should know what it covers, its extensions and exclusions to make sure that your construction project is secure.

What does it cover?
A builder’s risk insurance policy can cover both residential as well as commercial sites of construction. Most of the builder's risk insurance policies usually provide the coverage for the losses to the insured structured from a wide variety of events such as fire, wind, vandalism, lightning, wind, theft, hail, explosion, etc. The typical coverage of this insurance will be during the construction period.

Extensions of the coverage
A building or any structure, which is being constructed or renovated, is protected by a standard builder’s risk insurance policy from losses resulting due to fire, wind or acts of vandalism as discussed above. You can add some other types of losses to the policy, if needed. Some of the common builder’s risk insurance coverage extensions include:

Scaffolding – This coverage is extended to apply to scaffolding and temporary structures at the construction site.

Property in temporary storage – It covers the property that will be used or installed at the site.

Property in transportation - It protects your property, which is being transported to the construction site.

Debris removal – This policy pays for expenses to remove debris resulted from a disaster that is covered.

It also covers for the loss of valuable papers such as site plans, blueprints, etc.

Exclusions of the coverage
Some of the standard exclusions of builder’s risk insurance policy include losses due to earthquakes (may be purchased in some regions), employee theft, war, intentional acts of the owner, government action, mechanical breakdown, damage due to water, etc. It excludes coverage for damages resulting due to errors and omissions such as faulty design, planning, workmanship or materials used.

It is very important to choose the right policy as it not only offers better coverage, but also makes you pay low premiums. The policy should be prepared carefully to get appropriate type and level of protection. So, it is advised to approach a specialist insurance brokerage, which can provide accurate estimate of the costs of materials, labour and the complete value of the project to get the right level of coverage.

Builder’s Risk Insurance is also called as Course of Construction Insurance covers a building which is presently being constructed or renovated. It can also cover damages to the materials, which are to be installed or used at the construction site.

Keystone Insurance Group is Ireland’s premier supplier of public liability insurance and business insurance solutions to Irish industry. We offer a broad range of builders insurance, construction insurance, and business liability insurance products. Our public liability insurance Ireland and business insurance Ireland products offer great value to contractors and general business customers.

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