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What is Builder’s Risk Property Insurance?


New construction can be risky. Whether your property is undergoing extensive renovations, or you are building a new addition, there is always the possibility that something could go wrong. As such, your home or business needs adequate financial protection. Unfortunately, most insurance policies will not provide automatic coverage against losses that can be tied to new construction. Indeed, these types of losses may even be explicitly excluded.

You may need to obtain builder’s risk insurance. This type of insurance coverage is also sometimes referred to as ‘course of construction coverage’. It is a special type of supplement coverage, often purchased as a rider on an existing policy, which protects the property owner against any damage that might be done to their property as a result of renovations or new construction.

What is Covered Under a Builder’s Risk Policy?

Builder’s risk insurance policies can cover many different types of property losses. Indeed, this type of coverage can provide protection for the existing structure, including the items inside it, and it can also provide coverage for equipment and materials being used in the construction itself.

Further, a builder’s risk policy can provide coverage against many different causes of loss. For example, you may be able to obtain coverage against losses related to fire, storm damage, negligent workmanship, defective materials and vandalism. Ultimately, policyholders should always conduct an in-depth review of their specific policy to ensure that they have purchased the appropriate amount of insurance coverage for their individual needs.

All-Risk Policies vs. Named Peril Policies  

When you purchase builder’s risk insurance, your policy will either be: 1) an all-risk policy or 2) a named peril policy. Put simply, all-risk policies provide the broadest coverage that is possible under the circumstances. While some types of losses may be excluded under this type of policy, there is a general understanding that most things are covered. This is in contrast to named peril policies, which provide coverage for a certain set of predetermined causes of loss. It is imperative that you select the coverage that best suits your needs.

Builder’s Risk Insurance Disputes 

As with all other property insurance policies, disputes sometimes arise regarding builder’s risk coverage. Most frequently, these disputes pertain to the application of policy exclusions and policy exceptions. Both things can be somewhat difficult to apply in certain circumstances. To make matters more frustrating, the big property insurance companies are notorious for taken positions on coverage issues that are far more restrictive than is warranted under the text of the policy. In other words, valid claims are sometimes wrongly denied. If you are having trouble obtaining full payment under your builder’s risk policy, or if you claim has been denied outright, you should contact an experienced property insurance attorney as soon as possible.

Get Property Insurance Assistance in Broward County

At Geyer Fuxa Tyler, our dedicated property insurance attorneys have helped many home and business owners obtain the fair settlement offer they deserve. If you need help with your claim, please call us today at (954) 990-5251 to set up a free, no-obligation review of your case. We represent property owners throughout the region, including in Fort Lauderdale and Deerfield Beach.

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