What kind of risks may be covered by a builder’s risk insurance policy?

Builder’s risk insurance is specifically designed to protect against risks associated with buildings that are still under construction. This policy typically covers damage to the structure from various hazards such as fire, vandalism, theft, and certain weather events. This coverage is critical during the construction phase, as it provides financial protection against unforeseen incidents that could lead to significant losses.

While other types of insurance address different aspects of a construction project, builder's risk insurance focuses on the physical structure being built. For instance, liability for worker injuries is usually covered under workers' compensation insurance, while project delay costs might be addressed through other insurance or contract provisions. Similarly, loss of equipment may require a different type of insurance, such as equipment floater insurance. Thus, the coverage offered by a builder's risk policy is unique and essential for ensuring that construction projects can withstand various unforeseen damages during their development phases.