If a construction project suffers damage or loss due to any of the above, you may not be covered under a basic builder’s risk insurance policy. While many policies have set exclusions, you should ask your insurance agent about any additional offerings that might help fill the gaps left by your builder’s risk insurance policy. 

Does Builder’s Risk Insurance Cover General Liability? 
General liability and builder’s risk insurance are not the same, nor is general liability insurance covered by builder’s risk policies. Builder’s risk insurance is a type of commercial property insurance designed to cover the physical assets related to construction work whereas general liability covers bodily injury and property damage someone else may suffer. 

For example, say you are leading a construction project and overnight, a bad storm ruins the equipment left on the site and sweeps away several of the materials. In this case, you would file a claim on your builder’s risk insurance policy to cover the damages and other expenses caused by a possible delay. 

On the other hand, say that a visitor on your construction site trips over a piece of equipment and breaks their leg. General liability insurance can cover the victim’s medical bills and protect your business in the face of a related lawsuit. 

When Does Builder’s Risk Insurance End? 
Builder’s risk insurance operates differently than many other commercial insurance policies in that it only covers for a specific amount of time. Generally, the policy begins once the contract for construction has been signed by all parties and ends once the project is completed and approved. Once the contract is fulfilled, you will need another builder’s risk insurance policy for the next project. 

You cannot receive a refund if you don’t file a claim on your builder’s risk insurance policy or if you cancel your policy before the project ends. However, you can renew a builder’s risk insurance policy for the same project if said project is delayed or goes on longer than initially expected. 

Cancelling your insurance before a project is completed or failing to purchase builder’s risk insurance before a project starts can leave you facing expenses for an accident out of pocket, such as repairing or replacing damaged equipment.  

It is important to keep all of the project’s assets safe, but this isn’t always possible, especially with buildings that are half finished.  

Who is Covered Under Builder’s Risk Insurance? 
Anyone who has financial stake in a project’s completion should be covered under builder’s risk insurance. Since this insurance helps speed up the process of a delay and cover unexpected expenses, it us useful for general contractors and their subcontractors, the property owner, lenders and architects. 

In fact, some project managers or property owners may carry builder’s risk or require their hired general contractors to carry builder’s risk until the project is complete in order to cover their investment. 

Connect with an insurance agent and ensure that you and other people invested in the project understand who is responsible for carrying builder’s risk insurance.