Frequently Asked Questions

What is “Builder's Risk” or “Course of Construction” Insurance?

Builder’s Risk Insurance is a form of property insurance specifically designed to cover buildings under construction. The rates for builder’s risk insurance are discounted because there is very little property at risk when construction begins.

What is so good about Pro-Builder's Risk?

Builder’s Risk Insurance is not a “standardized” coverage form and coverage varies from insurance company to insurance company. Pro-Builders Risk is one of the broadest policies available on the market today. (See the Summary of Coverage) In addition to the structure, Pro-Builders Risk provides higher limits of coverage for property in transit to the job site and property stored at temporary locations awaiting delivery. Coverage is also provided for $50,000 of Soft Costs incurred following an insured loss. The automated reporting and Certificate of Coverage process also sets us apart from our competitors.

Are there other advantages to Pro-Builders Risk?

Pro-Builders Risk’s deductible applies per occurrence, not per structure. If one windstorm or fire damages more than one house, only one deductible is subtracted from the claim check. This feature allows a larger builder to select a larger deductible and reduce his costs without increasing his potential risk on a catastrophic loss.

Do you cover theft of building materials?

Yes. While some companies exclude theft coverage until the building is “dried in” and can be locked, Pro-Builders Risk provides theft coverage up to the full amount purchased on the structure. We also include theft coverage for losses from temporary storage locations, while in transit and at the construction site and once again, only one deductible applies if the theft occurs at more than one house.

Does builder's risk insurance cover tools and equipment?

As a general rule, Builder’s Risk Insurance is designed to cover the building and building materials that will become a permanent part of the completed structure. Contractor’s tools and equipment should be covered by a Tools and Equipment Floater Policy. Pro-Builders Risk does extend coverage for temporary forms, scaffolding, construction trailers and blueprints.

Does builder's risk insurance include liability coverage?

No. Builder’s Risk Insurance is primarily property insurance. Liability coverage is usually purchased under a separate Comprehensive General Liability policy for injuries to the general public or under a Workers Compensation policy to cover workers injured on the job.

Do you cover the replacement cost of the lost or damaged property?

Yes. There is no deduction for depreciation on new construction. Pro-Builders Risk pays the cost to repair or replace the damaged property with materials of like kind and quality.

Is builder's risk insurance renewable?

Yes. Most builder’s risk insurance policies are written on an annual basis and can be renewed if the construction takes longer than 12 months. Pro-Builders Risk can cover most structures up to 24 months and larger buildings can be insured for as long as the estimated construction period.

Can I buy builder's risk insurance after construction has begun?

Sometimes, but it is not a good idea to delay coverage. Builder’s Risk Insurance has discounted rates because there is very little property at risk when construction begins. If you wait until the structure is being framed and “dried-in” before you buy insurance, the discounted rates are inadequate for the property values at risk when the policy begins. If your project is more than 30% complete, your application will require special underwriting (ie. increased rates or denial of coverage.) If the structure is more than 50% complete, it may be impossible to find insurance coverage that protects you as the building owner.

I build some contract houses and my client and their lender both need to be named on my builder's risk insurance. Is there an additional charge for this?

>No. With Pro-Builders Risk, there is no additional charge for additional insureds and mortgagees. The Pro-Builders Risk automated system will issue as many Certificates of Coverage as needed to document the coverage for each insured party.

I have begun to form separate subsidiaries or divisions to develop separate projects. Can Pro-Builders Risk cover these divisions and is it going to cost more to insure more than one company?

Yes. The Pro-Builders Risk software has a section where you can list your divisions as additional insureds provided you have 51% ownership. There is no additional charge for this custom feature.