Builder’s Risk Policy vs. a Loss: Which Costs More?

Builders Risk 2

“I don’t need a Builder’s Risk policy,” said a contractor.  “The money I save I’ll just set aside for any losses.” Little did he know how inexpensive a Builder’s Risk policy can be and how expensive a loss can be.

One important thing to consider is that the value of the building increases as the project progresses. Starting out, the contractor may not have a lot of value on site…just the foundation and some lumber. However, after a few months, he will have fixtures and HVAC, electrical and plumbing, appliances and hardware, and the list goes on and on.

What if a furnace is delivered and is stolen before it can be installed? The cost of that furnace may be considerably more than the contractor could have paid for a Builder’s Risk insurance policy.

What if a wind storm blows a section of the roof off exposing the interior of the building to a torrential downpour? Not only will the roof need repaired, drywall and flooring will need to be replaced. The cost of these repairs will need to come out of the contractor’s profit if they are not properly protected.

Protect your profits from unexpected losses by purchasing a Builder’s Risk policy before beginning your next project. It will not only help save you money but will provide peace of mind. Contact your independent agent to learn more.

For more on Builder’s Risk coverage, see our blog post “Why Do You Need A Builder’s Risk Policy?”

The information above is of a general nature and your policy and coverages provided may differ from the examples provided. Please read your policy in its entirety to determine your actual coverage available.


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