When Should I Buy Builders Risk Insurance for My Construction Project?

Nate Jones, CPCU, ARM, CLCS, AU
1 day ago
2 min read

Builders risk insurance is a specialized policy designed to protect construction projects, home renovations, and commercial builds from unexpected losses such as fire, theft, or weather damage. Timing your purchase correctly is critical to avoid gaps in coverage and ensure your investment is fully protected.

The Ideal Time to Buy Builders Risk Insurance

Builders risk insurance should generally be purchased before construction or renovation begins. This includes:

Groundbreaking for a new home or building
Major structural renovations or rehabs
Additions or extensions to existing buildings

Buying coverage after construction starts can leave you exposed to risks that occur during the early, high-risk phases of a project.

Why Timing Matters

Construction projects face risks from day one:

Theft or vandalism of materials stored onsite
Fire or water damage during framing, roofing, or wiring stages
Weather-related incidents affecting incomplete structures

If your project is underway and you wait to secure coverage, any damage occurring before the policy is active is not covered. The Insurance Information Institute emphasizes the importance of initiating builders risk insurance at project start.

Coordination With Contractors and Lenders

Many lenders require builders risk insurance as a condition for financing. Additionally, general contractors and subcontractors may want proof of coverage before starting work.

Proper timing ensures:

Your lender’s requirements are met
Contractors are protected from liability
Coverage for all materials, equipment, and temporary structures begins immediately

Duration of Builders Risk Insurance

Builders risk insurance is typically temporary, ending when:

The construction or renovation project is completed
The building is occupied
Coverage reaches a specified policy expiration date

Planning ahead allows you to align coverage duration with project timelines, preventing gaps that could result in uncovered losses.

Optional Endorsements and Early Coverage Benefits

Starting your builders risk insurance early also allows you to add optional endorsements such as:

Flood or earthquake coverage
Soft costs (additional interest, permits, or fees due to delays)
Coverage for materials in transit or stored offsite

These endorsements help close gaps that standard policies may not cover during the early phases of construction.

How Wexford Insurance Can Help

At Wexford Insurance, we specialize in builders risk insurance for both residential and commercial projects. We help property owners, developers, and contractors: