Builder’s Risk Insurance: What Is It and Who Needs It?


Builder’s risk insurance is exactly what the name implies. It is an insurance policy that provides coverage for risks associated to build jobs. During the construction process, damages to the structure, materials or equipment sustained from things like wind, fire, vandalism and theft are usually covered by this type of policy. Keep in mind, this type of policy is not related to workers comp and won’t cover injury to personnel.

People who should look into purchasing this type of insurance coverage are those who commonly work on building renovation and construction projects. For example, if you are a Santa Febuilder and you are renovating a large home, you’ll want to put builder’s risk insurance in place before your supplies are even delivered to the work site. Look at the climate and common issues in the area where you will be working. Address your concerns with your insurance agent so you know your equipment and the structure are covered.

Another person who may secure a builder’s risk insurance policy is the homeowner. Many people believe homeowners benefit from being the policyholder because if there was a claim they would be the beneficiary. If the contractor or builder holds the policy they would be in control of how the funds are handled when a claim is paid.