What builder's risk covers
| Covered (typical) | Often optional or limited | Usually excluded |
|---|---|---|
| The structure under construction, from foundation to completion | Soft costs (extra interest, permits re-issue, lost rent) after a covered delay | Earthquake and flood unless added by endorsement |
| Materials and fixtures on site waiting to be installed | Existing structure on a renovation | Faulty workmanship, design or materials (resulting damage may be covered) |
| Materials in transit or stored off site (sublimit) | Scaffolding, forms and temporary structures | Wear and tear, mold, gradual water seepage |
| Fire, lightning, wind, hail, theft, vandalism, collapse | Debris removal and code upgrade above base limits | Contractor's tools and equipment (that is inland marine) |
Note: Every policy is different — the declarations and exclusions control. We share the policy form or a specimen before you bind whenever the market provides one. General information only, not legal advice; your contract and policy wording control.
Who buys it: the owner or the contractor?
The construction contract decides. Many commercial contracts based on AIA documents make the owner buy the property (builder's risk) insurance. Many residential remodel, custom-home and design-build contracts put it on the contractor. Lenders on construction loans almost always require it and ask to be named as loss payee or mortgagee.
Read the insurance article of your contract before you bid. If you are responsible for builder's risk and do not buy it, a fire or theft loss on the job can come out of your pocket — your general liability does not pay to rebuild your own work in progress.
Types of projects we place
- Ground-up residential and light commercial construction
- Renovations and remodels of existing buildings — including coverage for the existing structure when the contract requires it
- ADUs and garage conversions (see our ADU builder's risk page)
- Spec homes and builders with several projects a year — an ongoing (reporting-form) policy instead of one policy per house
- Wildfire rebuilds in Los Angeles, Altadena and other burn areas
- Owner-contractors renovating a property they own (a different product than standard builder's risk)
What decides eligibility and price
- Completed value — the total finished value of the project (labor + materials), not the land. Most policies are written on a completed-value basis.
- Construction type (wood frame vs. masonry or steel), number of stories and square footage.
- Location: wildfire zone, flood zone and theft exposure at the address.
- Whether construction has already started — many markets decline or refer a project that has already broken ground. Call before the start date.
- Project length, security (fencing, lighting, cameras) and the builder's experience and losses.
- Whether you already carry $1M per-occurrence general liability — some builder's risk markets require it.
Project values we can place
Through our builder's risk markets we can place single projects with completed values up to about $5 million, and larger projects by submission. Several markets give an instant price for smaller residential projects; others underwrite each submission.
What to have ready
- Project address and a short description (new home, ADU, remodel, commercial TI)
- Completed value and square footage; construction type and stories
- Start date and expected completion date — and whether work has started
- Owner, general contractor and lender names (for loss payee / additional insured)
- The insurance section of the construction contract or lender's requirements
Frequently asked questions
Does my general liability policy cover a fire on my jobsite?
Generally not for your own work in progress or the materials for it — that is builder's risk. On a remodel, GL may respond to damage you cause to other parts of the owner's property, depending on the policy.
When does builder's risk end?
Usually at the earliest of the policy expiration date, completion, acceptance by the owner, or occupancy. If the owner needs to move in before completion, ask for a permission-to-occupy endorsement before they do.
Is earthquake covered?
Not on most builder's risk policies. Earthquake and flood are typically excluded unless you add them by endorsement where available.
Can I buy builder's risk after construction has started?
Sometimes, but many markets decline or refer projects already underway. Contact us before the start date.
Is builder's risk required by law in California?
No state law requires it. Lenders and construction contracts are what require it.