FAQ - Builders Risk Insurance

Builders Risk insurance protects a building project during the course of construction by covering direct physical damage to the structure and materials until the project is completed or occupied. It is temporary coverage designed specifically for the construction phase and does not replace General Liability insurance or permanent property insurance.

What does it cover?

Builders Risk covers sudden, accidental, physical damage to the building under construction, materials that will become part of it, certain temporary jobsite structures, and limited materials in transit or storage. It typically includes losses such as:

• Buildings under construction: direct physical loss or damage to structures while they are being built.
• Materials and supplies: materials that will become a permanent part of the project, whether on site, in transit, or in temporary storage. 
• Temporary structures and scaffolding: protection for scaffolding, construction forms, and temporary fencing at the jobsite.
• Fire, theft, and vandalism: protection against common causes of jobsite loss. 
• Windstorm, hail, and lightning: damage caused by windstorm, hail, or lightning. 
• Debris removal: costs to remove debris from covered property following a covered loss, subject to policy limits. 

What's not covered? 

It does NOT cover flood or earthquake unless added, faulty workmanship or design errors, normal wear and tear, mechanical breakdown, or financial losses like delays, lost income, soft costs, or contract penalties. If poor workmanship leads to a separate covered event., such as a fire, the fire damage may be covered, but the faulty work itself is not. 

Does it cover mistakes made by contractors or subcontractors?

It does not pay to fix defective work. However, if faulty work causes a separate covered event, such as a fire, the resulting damage may be covered. 

Does it cover theft from the jobsite? 

Yes, theft of covered building materials is typically included, subject to policy terms and security conditions. 

What happens if the project value increases during construction?

The policy limit should match the full completed value. If the project is underinsured, claim payments maybe reduced due to coinsurance. 

Where do I file a claim? 

You file a claim with ViCoverage powered by Vertical Insure.

How To File A Claim: vicoverage.com/resources/how-to-view-your-coverage-or-file-a-claim

Can I mark up that policy?

Yes, you are free to mark up on the policy as much as you want. We generally recommend having it included in the total budget of the project.

If I put a Builders Risk policy in the homeowner’s name, are there any best practices for invoicing them?

Yes. You can invoice the homeowner for the policy, but avoid sharing a copy of the policy that shows the actual premium.

What happens if my project lasts longer than a year, and what is the deductible?

Builder’s Risk policies are issued for an initial 12-month term. If your project runs longer, you can request a 6-month extension. Deductibles can vary based on the policy, so be sure to review your quote or policy documents for specific details.

How are policy extensions priced for Builders Risk insurance?

Extensions are typically prorated based on the original policy cost. For example, if a 12-month policy was $1,200, a 6-month extension would be approximately $600.

How to I request a quote? 

Go to your Project Settings -> Insurance tab and click "Get a Quote". 

What kind of rates can I expect to receive? 

Below is a handout provided by ViCoverage powered by Vertical Insure that gives Builders Risk Master Rates for new construction, tiered by home value.