Search The Site
Try a different word, or check the spelling.
Builders Risk Insurance
Help protect the investment you’re making in a new building or renovation while work is underway.
- In short
- Builders risk protects the project while it is being built, and ends when the building is done.
- Who or what is protected
- The structure under construction and materials intended to become part of it.
- Where it stops
- Tools and equipment, faulty workmanship, and the finished building sit outside.
Coverage for a project while it is built
This guide helps you follow a project’s coverage from first delivery to handover, and know what sits outside it.
Policy background and wording
Builders risk insurance, sometimes called course-of-construction coverage, helps protect a project while it is being built or renovated. It commonly covers the structure itself along with materials, fixtures, and equipment intended to become part of the project.
Policies are typically written for the duration of the project and end when construction is complete and the structure is occupied or accepted. Coverage can often be extended to materials in transit or at temporary storage sites.
Protect the project through its changing stages
Confirm start and termination triggers, completed value, off-site storage, and transit. Delay-related soft costs are not automatic and may need endorsements.
Who typically looks at it
- General contractors and builders
- Property developers
- Owners undertaking major renovations
- Real-estate investors building or rehabbing
- Specialty contractors on large projects
How it works
A project’s coverage period
Builders risk can begin with materials stored or in transit, runs through construction, and ends at completion. Permanent property should begin when it ends.
Read the diagram as text
In order:
- Materials stored or in transit
- Construction in progress
- Completion, acceptance or occupancy
- Building in use
- Builders risk: structure and materials
- Permanent property
- Contractors’ tools: inland marine
Terms on this page
- Course of construction
- Another name for builders risk.
- Soft costs
- Delay-related expenses; not automatic and may need endorsements.
- Completed value
- The project’s finished value, used to set coverage.
Look deeper
Who arranges the policy?
Owners, general contractors, or developers, depending on the contract; lenders frequently require it.
What to check: Read the insurance clause in the construction contract.
Is faulty workmanship covered?
Commonly excluded, though resulting damage may be treated differently.
What to check: Ask how the form handles resulting damage.
Which form covers what on a job?
Three forms, three different things.
| Builders risk | Inland marine | Commercial property | |
|---|---|---|---|
| Covers | The project and its materials | Contractors’ tools and equipment | The finished building |
| When | During construction | Wherever tools travel | After completion |
Scroll sideways to compare all columns.
What it may cover, and where it stops
Exact terms depend on the carrier, policy form, endorsements, and applicable law. Review the wording with your agent.
May cover
- The structure under construction against covered perils
- Materials, supplies, and fixtures on site
- Certain materials in transit or at temporary storage
- Damage from fire, wind, theft, and vandalism, subject to terms
- Soft costs and lost income, when those options are added
Commonly excluded or limited
- Faulty workmanship or design, in many cases
- Wear, tear, and gradual deterioration
- Tools and equipment of contractors, which inland marine may address
- Earthquake and flood, unless added
- Losses after the project is completed and accepted
True Builders Risk™ Insurance Program
The Southern Agency’s construction-focused offering gives you a program to discuss alongside the general coverage explained in this guide.
These are program options to explore, not a list of benefits included in every Builders Risk policy. Availability depends on the project, insurer, policy form, and endorsements. Your issued policy determines what is insured.
How the offering may fit your project
- Terms that follow the project
- The program describes 1–36-month policy options. Ask which term fits your schedule and whether an extension can be approved if completion moves. Early-completion return premiums depend on the policy’s cancellation and earned-premium terms; a refund is not automatic.
- A range of projects and markets
- The Southern Agency’s offering describes multi-carrier access for projects from individual homes to multifamily developments, including coastal and hard-to-place sites. Available markets, project size, terms and acceptance depend on the submission and underwriting; comparison does not guarantee savings.
- Construction-focused support
- Ask the agency about construction-focused underwriting and claims support, along with certificate and endorsement processing. The people involved, turnaround and approvals depend on the request and insurer. A certificate does not change policy coverage.
Have your project location, construction budget, and expected start and completion dates ready. Contact an agent about the program or call 1-800-777-1TSA.
Working through an example
Hypothetical and for illustration. Whether a real loss is covered depends on the facts and the policy.
- What happens
Theft of materials
Building materials are stolen from a job site.
- Which part is relevant
Materials intended to become part of the project are builders risk property.
- What could change the outcome
- Deductibles apply.
- Materials stored off-site need that extension.
- Tools stolen at the same time are an inland marine question.
Other situations
Fire during construction
A fire damages a structure mid-construction. Builders risk may help with repairs and replacement of covered materials, subject to policy terms.
Before you talk to an agent
What underwriters usually weigh
- Total completed value of the project
- Construction type, location, and duration
- Scope of perils and added options
- Security and safety measures on site
- Selected limits and deductibles
Other questions owners ask
Who should buy builders risk insurance?
Owners, general contractors, or developers commonly arrange it depending on the contract. Lenders frequently require builders risk on financed projects.
When does builders risk coverage end?
Coverage generally ends when the project is completed and the structure is occupied or accepted, at which point a permanent property policy commonly takes over.
Does it cover contractors' tools?
Contractors' tools and equipment are commonly covered under inland marine rather than builders risk, which focuses on the project and its materials.
Does builders risk cover faulty workmanship?
Faulty workmanship or design is commonly excluded, though resulting damage may be treated differently depending on the policy. Review terms carefully.
Can soft costs be covered?
Many policies allow you to add soft costs and lost income, which can help with delays caused by a covered loss, subject to terms.
Talk through builders risk insurance with an agent
We compare carriers, explain the wording, and help you choose limits that fit how your business actually runs.