A Guide To Builders Risk Coverage

Protecting Your Construction Project

When embarking on a construction project, whether it's a residential home or a large commercial structure, ensuring comprehensive insurance coverage is essential. Builders risk insurance, a specialized type of property insurance, provides critical protection for buildings under construction. This guide delves into the various builders risk insurance coverages offered by Veritas, tailored to meet diverse project needs.

Understanding Builders Risk Insurance

Builders risk insurance, also known as course of construction insurance, covers buildings and structures while they are under construction. This insurance protects against risks such as fire, theft, vandalism, and certain weather-related damages that can occur during the building process.

Coverage Options for Different Project Types

Veritas provides builders risk coverage for residential projects, commercial projects valued up to $10 million through an automated process, and commercial projects valued up to $75 million through a manual process. Each project type has unique coverage options and endorsements available to ensure comprehensive protection.

1. Residential Projects

   • Standard Coverages: These include protection against fire, theft, vandalism, and certain weather-related damages.
   • Optional Endorsements: Additional insured coverage, debris removal, earthquake or earth movement, expediting expense, flood or water damage, and more.

2. Commercial Projects (Valued up to $10 Million)

   • Standard Coverages: Similar to residential projects but tailored for commercial needs.
   • Optional Endorsements: Business income and extra expense, claim preparation expense, contract change order, pollutant clean-up, and more.

3. Commercial Projects (Valued up to $75 Million)

   • Standard Coverages: Comprehensive protection tailored for high-value commercial projects.
   • Optional Endorsements: Extensive options including better green coverage, business income and extra expense, scaffolding re-erection, site work and underground property exclusion, and more.

Key Coverages and Endorsements

• Additional Insured (Including Architects & Engineers): Protects additional stakeholders involved in the project.
• Backup of Sewers, Drains or Sumps: Covers damages caused by backup issues.
• Better Green Coverage: Provides coverage for eco-friendly rebuilding practices.
• Business Income and Extra Expense: Covers loss of income and extra expenses incurred due to a covered loss.
• Claim Preparation Expense: Covers costs associated with preparing and filing a claim.
• Contract Change Order: Covers costs related to change orders during construction.
• Debris Removal: Covers costs for removing debris after a covered loss.
• Earthquake or Earth Movement: Provides coverage for damages caused by earthquakes or earth movement.
• Existing Structure: Covers damages to existing structures on the construction site.
• Flood or Water Damage: Provides coverage for flood-related damages.
• Pollutant Clean-Up: Covers the cost of cleaning up pollutants after a covered loss.
• Rain, Snow, Sleet, and Ice Coverage Extension: Extends coverage to include damages caused by these weather conditions.
• Scaffolding and Scaffolding Re-Erection: Covers costs associated with scaffolding and its re-erection after a loss.
• Soft Costs: Covers additional costs that may arise due to delays in construction, such as interest on loans, real estate taxes, and advertising expenses.
• Temporary Storage and Transit: Covers materials and equipment stored temporarily off-site or in transit to the construction site.

Conclusion

Builders' risk insurance is a crucial component of any construction project, offering peace of mind and financial protection against unforeseen risks. By understanding the various coverage options and endorsements available, you can tailor a policy that meets the specific needs of your project, ensuring robust protection throughout the construction process.

For more information on securing the best builders risk coverage for your project, visit Veritas and get started today.