Understanding Builder’s Risk Insurance
To fully understand the importance of builder’s risk insurance, it is first important to understand what this type of insurance policy is. For the most part, it is a type of property insurance. Many times, it is referred to as Course of Construction. The purpose behind the policy is that it provides coverage for a piece of construction while it is in the construction phase. Those who purchase this type of insurance can choose what is covered. For example, some people choose to cover only the building itself, while others may opt for a policy that covers both the building and the materials.
A builder’s risk insurance policy usually has some type of limit. If damage occurs that exceeds this limit, it will be not be the responsibility of the insurance provider to cover the associated expenses. Because of this, it is of the utmost importance for a policyholder to purchase a plan that adequately covers the total value of a building as well as any materials being used.
Most builder’s risk policies can be written in any of the following terms: