What Is Builder’s Risk Insurance? 

Builder’s risk insurance is a specialized type of property insurance designed to cover buildings and structures while they are under construction. At Valera Agency, we understand that every construction project comes with unique risks, whether you’re a contractor, builder or property owner. Securing the right builder’s risk insurance can help safeguard your investment from unexpected setbacks.

Understanding Builder’s Risk Insurance

Builder’s risk insurance, sometimes called “course of construction” insurance, may cover property and materials during the construction or renovation process. This coverage typically applies to new builds, major remodels or additions. It may help financially protect against losses from events such as fire, theft, vandalism, wind and certain types of water damage that may occur before the project is completed.

What Does This Insurance Cover?

A standard builder’s risk policy may include protection for the following:

• The structure while it’s under construction
• On-site materials, supplies and equipment
• Temporary structures like scaffolding or fencing
• Certain soft costs, such as lost income or additional expenses due to project delays (if added to the policy)

It’s important to note that builder’s risk insurance usually does not cover accidents or injuries on the jobsite, faulty workmanship, or normal wear and tear. Additional policies or endorsements may be needed for broader protection.

Who Needs This Coverage?

Anyone with a financial interest in a construction project can benefit from builder’s risk insurance. This may include the following:

• General contractors and subcontractors
• Property owners and developers
• Lenders or investors involved in the project

In Pennsylvania, many lenders and project owners require builder’s risk coverage before work begins. Having the right policy in place can also help keep your project on track if the unexpected happens.

Learn More

The team at Valera Agency works closely with clients across Pennsylvania to assess their construction insurance needs. We can help you understand your risks, compare policy options and secure builder’s risk coverage tailored to your project. Contact us today to get started.

This blog is intended for informational and educational use only. It is not exhaustive and should not be construed as legal advice. Please contact your insurance professional for further information.