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What is Builder's Risk Insurance?

Existing buildings are exposed to a wide variety of threats—fire, flooding, and vandalism are just a few of the ways building structures can be harmed. However, buildings under construction aren't ready to face risks that completed buildings can withstand. There's also the chance of an accident during the construction phase, like materials being destroyed or installed incorrectly. A proper risk analysis from our Berry Curtis Insurance agents can help reduce the number of threats a new construction faces, and our agents can help reveal additional threats that may need to be covered by additional policies.

Builder's risk insurance is a policy designed to mitigate the chance of loss and protect you in the event that damage is done to the building. This policy is most commonly purchased by landowners and those funding the project, although some contractors purchase it in order to have more control over how each job is insured.

This policy is mainly designed for new construction, rather than changes and improvements to existing buildings. That form of construction is usually covered by property insurance and does not need any additional coverage, although it's best to talk with an agent before starting any particularly large project just to be absolutely sure it's covered.

What Does Builder's Risk Insurance Cover? What Does It Not Cover?

Builder's Risk Insurance generally covers the owner, the lending institution, the contractor(s) performing the work, and other related parties. In addition to providing coverage for damage to the building itself, most plans also cover temporary constructs (like scaffolding), materials, and equipment being used (whether it's currently on-site or off-site). The majority of policies are written on an all-perils basis, which means that reimbursements are available for any losses except those specifically excluded.

Common exclusions from this coverage include (but are not limited to):

  • The value of the land itself
  • Employee theft
  • Damages beyond the estimated value of the construction
  • Any losses brought by law or ordinance changes
  • Damage from earthquakes
  • Losses from war, nuclear hazards, or actions by civil authority

As you can see, most of the exclusions are not likely to occur during the course of a normal construction project. The value of the land is the only one likely to change as new work is done, and you will likely need to account for any improvements or losses the next time your company prepares taxes.

Builder's Risk Insurance Policy Lengths

Most policies last until the building is no longer under construction. The exact point at which this occurs can vary—it may be when certain parts of the structure are done (but finishing work, like painting, has not been completed), up to the day it opens for business, or when the contract with the construction company ends. If you're worried about interim risks—like the building being damaged between when construction finishes and when it opens for business—talk to one of our agents and ask about extending your coverage.

 

1. "Threat/Vulnerability Assessments and Risk Analysis." WBDG. Accessed April 20, 2016. https://www.wbdg.org/resources/riskanalysis.php.

2. "Who Should Buy Builder’s Risk Insurance?" BuildingAdvisor. Accessed April 20, 2016. http://buildingadvisor.com/who-should-buy-builders-risk-insurance/.

3. "How Do I Account for Land improvements?" Questions & Answers - AccountingTools. Accessed April 20, 2016. http://www.accountingtools.com/questions-and-answers/how-do-i-account-for-land-improvements.html.

Our Locations

*Main Office - Redding

2947 Victor Ave
Redding, CA 96002
Main office: 530-223-0637

Corning

705 4th Street
Corning, CA 96021
Main office: 530-838-9098

Our Providers

Testimonials

Berry Curtis Insurance has the nicest, most helpful people I have ever met. They have just great, professional people working there. I am comfortable with them. They are a good, local agency, and I will continue to use them. I was originally with Allied Auto Insurance, and I wanted a more local agency. I switched over to them, and it was the best move I ever made. They deserve kudos. Any future business having to do with insurance I will do with them, because of their level of professionalism. They deserve six stars as opposed to five stars.
Daniel S
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Berry Curtis Insurance covers my home, cars, and helps me with my business. I've known him for quite a while and he's very knowledgeable. If I have any questions, I can call and he always has the time to talk about them. Out of all the insurance people I've dealt with in the last 40 years, I've never had an insurance agent more helpful than Berry Curtis.
Thomas H.
erry Curtis has been an absolute pleasure to work with over the years. While his offices are in Redding and my business and residence are located in Sacramento he has helped immensely in more ways than I can count. My wife and I have our personal auto lines, our home owners, business liability, workers comp, and our business auto's all insured through Berry Curtis Ins. It is such a luxury to have one person to talk to about so many complicated issues in our personal and business lives. Berry and his staff are extremely helpful and knowledgeable. In addition, Berry is always willing to shop around for the best rates for each of our policies and has saved me a bundle by doing so. Also, the many times in which we need service such as to file a claim, change an employee, add or alter coverage, payroll reports, etc., they are always able to help almost immediately. They respond to calls and emails immediately unlike some where you may wait days or might even never receive follow up call. Their fees are minimal and we never feel like we are being overcharged. If you need insurance of any type you can rest assured Berry Curtis will make the process as simple and pleasant as possible.
Brian S.