Quick answer: Builder's risk covers physical loss to the building under construction and the materials meant for it — on site, in transit and in storage — from causes such as fire, theft, vandalism and wind. It usually excludes earthquake, flood, faulty workmanship itself and wear and tear, and it ends at completion or occupancy. The details that most often create coverage gaps are theft conditions, water damage limits and occupancy.
Five common coverage gaps to check
- Theft of materials not yet installed — many policies require materials to be secured, fenced or locked, or limit theft of unattached materials.
- Water damage — some forms limit or exclude water damage during certain phases (e.g., before the roof is on) or require leak detection on larger projects.
- Faulty workmanship — the defective work itself is excluded; ensuing damage (the fire or collapse it causes) may be covered, depending on the wording.
- Occupancy — once the owner moves in or uses the building, coverage usually ends unless endorsed.
- Earthquake and flood — excluded unless added by endorsement.
Common options to ask about
| Option | What it does |
|---|---|
| Soft costs / delay in completion | Pays extra interest, fees, lost rent or other costs caused by a covered delay |
| Existing structure | Covers the existing building on a renovation, not just the new work |
| Off-site storage and transit | Raises the sublimit for materials stored elsewhere or on the truck |
| Scaffolding and temporary works | Covers forms, fencing and scaffolding |
| Permission to occupy | Lets the owner occupy part of the building before completion |
| Earthquake / flood | Adds these perils where a market offers them |
Builder's risk vs. other policies
| Loss | Policy that responds |
|---|---|
| Fire damages the house you are framing | Builder's risk |
| Your crew damages the neighbor's fence | General liability |
| Your generator is stolen from the job | Contractor's equipment (inland marine) |
| A small-job contractor's installed materials are stolen before acceptance | Installation floater |
| Your worker is injured on site | Workers' compensation |
Get a builder's risk review
Call (858) 925-9555 or request a review online — only your name, phone and email are required; we collect project details by phone. Asena Capital Insurance Services, CA License #6008596.
Frequently asked questions
Does builder's risk cover my tools?
Generally no. Some forms include a small tools extension, but tools and equipment belong on contractor's equipment (inland marine) coverage.
Does builder's risk cover theft of copper wire or appliances?
Usually yes if they are part of the project, subject to the policy's theft conditions and sublimits. Installed appliances and materials stored on site are common theft targets — ask about the theft terms.
Is mold covered?
Mold is usually excluded or tightly limited.