What Does Builders Risk Insurance Cover for Renovations and New Construction?

If you’re undertaking new construction or major renovations, builders risk insurance is a critical form of protection. It safeguards your investment while the property is under construction, which standard property insurance policies typically do not cover.

Builders risk insurance is designed for developers, contractors, and property owners to protect buildings, materials, and equipment from unexpected losses during construction.

1. Coverage for Property Under Construction

Builders risk insurance protects the physical structure during the construction or renovation process. Covered risks often include:

• Fire and smoke damage

• Lightning strikes

• Wind and hail damage

• Vandalism or theft of materials

This coverage is temporary, typically lasting until construction is complete or the property is occupied.

Materials and Equipment Coverage

Builders risk insurance also covers materials and equipment that are:

• On-site

• In transit to the construction site

• Stored off-site for the project

This ensures that costly materials like lumber, steel, or appliances are protected from theft, fire, or other covered perils.

Optional Coverage Endorsements

Depending on your project, additional coverage can be added to protect against risks like:

• Flood and earthquake damage

• Equipment breakdown or mechanical failure

• Soft costs, such as extra interest, permits, and fees due to delays

These optional endorsements help prevent unexpected expenses from turning a construction project into a financial loss.

Liability Considerations During Construction

While builders risk insurance primarily covers property and materials, liability coverage is often separate. General liability insurance is recommended to protect against:

• Injuries to workers or visitors

• Property damage to neighboring buildings

• Legal defense costs

Contractors should ensure they have both builders risk and liability coverage for full protection. The National Association of Home Builders provides guidance on construction liability risks.

Why Builders Risk Insurance Matters

Without builders risk insurance, property owners and contractors could face:

• Out-of-pocket repair costs from fire, water, or theft

• Delays in project completion due to uninsured losses

• Financial exposure from damaged materials or equipment

This coverage provides peace of mind and financial security throughout the construction or renovation process.

How Wexford Insurance Can Help

At Wexford Insurance, we specialize in builders risk insurance tailored for renovations and new construction projects. Our experts help you:

• Identify risks specific to your project

• Structure coverage for materials, labor, and equipment

• Ensure compliance with lender or contractor requirements

👉 Request a builders risk insurance quote from Wexford Insurance today and protect your construction investment from start to finish.

REQUEST A FREE QUOTE

Frequently Asked Questions

• Do I need builders risk insurance for my home renovation or rehab project?

• What’s the difference between builders risk insurance and homeowners insurance?

• How much does builders risk insurance cost for residential and commercial projects?