Small business insurance will protect the owner’s assets in case of a serious accident or natural disaster, but it won’t pay for damages caused by poor construction practices.
Course of Construction Policies are a building contract between the owner and builders. A builder could be held liable if he or she doesn’t follow the contract’s specifications. If a builder fails to disclose these risks, he or she could be held liable for all damages.
If a builder doesn’t follow the contract specifications and is held liable for any damage done to the owner’s property due to construction practices, Builders’ Risk Insurance may not cover the damages.
What Is Builder’s Risk Insurance?
Insurance policies are designed to protect the insured against financial loss in the event of a covered incident. Builder’s Risk Insurance, also known as Builders’ All-Risk Coverage or Builder’s general Liability Insurance, is an insurance policy that offers protection to builders and contractors for risks such as injury or property damage caused by their work.
Builder’s Risk Insurance policies are not designed to cover the builder’s responsibility for errors in his or her own work.
Builder’s Risk Insurance should be negotiated with an experienced broker to assure that the builder is protected against liability and other risks such as injuries, property damage, and other hazards.
What Does It Cover?
Builder’s Risk Insurance is an important form of protection for builders that protects against the possibility of financial loss during construction.
The policy covers not only damages to third-party property but also injuries and losses to third parties.
What Is Not Covered by Builder’s Risk Insurance?
Builder’s Risk Insurance does not cover damages caused by floods, earthquakes, or war. It does not cover completed structures, but rather protects builders against losses during building construction.
Who Needs Builder’s Risk Insurance?
Anyone who is building, remodeling, or repairing someone else’s property is in need of Builder’s Risk Insurance.
What Are the Effects of a Course of Construction Policy on Builder’s Risk Insurance?
Builder’s Risk Policies are very different from standard property insurance policies because they cover the contractor who is working on someone else’s property, not just the homeowner. The homeowner’s property insurance does not cover the contractor.
The name “Builder’s Risk Policy” stems from its original use, which was to protect contractors who were building homes from the financial risk of being unable to complete a project when it was damaged by fire or storm.
Although Builder’s Risk Policies are now available for other types of projects, the name still reflects its original use and purpose. Most business insurance agencies offer this type of policy for builders, construction managers, and other construction professionals.
The course of the policies affects Builder’s Risk Insurance because they offer protection to builders in case their work is sabotaged by fire, storm, or theft.
Who Should You Contact?
Does your home have Builder’s Risk Insurance policy? If not, you should contact Bethany Insurance Agency to learn more about Course Of Construction Policies and how they can protect your business.
