Whether you’re building a brand-new commercial space or remodeling an existing structure, it’s essential to consider the unique risks that come with construction. From unexpected weather to material theft or fire, property under construction faces exposure that isn’t always covered by a standard commercial property policy. That’s where Builder’s Risk insurance comes in.
What Is Builder’s Risk Insurance?
Builder’s Risk is a specialized type of property coverage designed to financially protect buildings while they’re under construction, renovation, or repair. While some commercial property policies may include limited coverage for construction exposures, they often come with significant restrictions, such as sublimits for new buildings and exclusions for materials in transit or storage.
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Builder’s Risk policies, on the other hand, are built specifically for this scenario. Though there is no universal policy form, many Builder’s Risk coverage is written on an “all-risk unless excluded” basis and can include:
- Coverage for buildings under construction or renovation
- Coverage for materials at the job site, in transit, or in off-site storage
- Coverage for scaffolding, permanently installed equipment and temporary structures
- Soft costs, like advertising expenses or additional architectural fees, that result from covered delays in completion
Learn More: Why Do I Need a Builder’s Risk Policy?
The coverage limit is typically based on the total completed value of the structure.
Why Early Planning Matters
Because Builder’s Risk coverage involves more specialized underwriting than a typical commercial property policy, it’s important to involve your independent Central agent early in the planning process. They’ll help evaluate your project scope, review contract terms, and determine the most appropriate coverage and carrier fit to avoid costly gaps down the line.
At Central, we work hand-in-hand with our appointed agents to tailor coverage that fits the specific needs of each project, no matter the size of construction. That’s the Central difference.
Discover: Installation Floater vs. Builder’s Risk: What’s the Difference
Take the Next Step
Planning a construction project or major renovation? Connect with your local Central agent today to explore whether Builder’s Risk is the right solution for your business.
Did You Know: Central is proud to have an AM Best rating of “A” Excellent.
The information provided in this blog is for informational and educational purposes only and does not constitute legal, insurance, or other professional advice. It is not intended to interpret or modify any insurance policy. Coverage may vary based on individual circumstances, policy language, endorsements, exclusions, and applicable state law.
All descriptions, summaries, or examples are general in nature and may not reflect your specific policy or coverage. No guarantee is given regarding the accuracy, completeness, or timeliness of the information. Your policy contract governs, and you should review it in its entirety to understand your actual coverage.
Nothing in this content creates a broker, agent, or advisory relationship, and you should consult your insurance professional for advice specific to your needs.
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