Have you been wondering what is builders risk insurance? If so you are not alone. There seems to be some confusion as to exactly what this type of insurance is for and who it’s for. Builders risk insurance is a type of insurance purchased by contractors and building owners. This type of property insurance will cover any damage to a building while it is under construction. The insurance will cover damage caused by fire, vandalism and some weather events. Typically, flooding is not covered.
The insurance policy only covers the owner during construction. On a construction site, the contractor is responsible for loses due to his negligence. All other loses are the building owners responsibility. This makes having builders risk insurance important. If the construction project is adding on to an existing building, property insurance may cover the project. Always check with a reputable insurance agent to make sure you are covered.