When Should a Builder’s Risk Policy Be Purchased?

This is an excerpt from our free “Broker’s Guide to Builder’s Risk Insurance” eBook. Click here to download your copy.

A Builder’s Risk policy should be purchased prior to or on the date of construction when the contract is finalized – before the project is underway. Builder’s Risk is temporary insurance with coverage ending once the construction project is considered completed, as defined in the policy.

Coverage can be written for three, six, nine, or 12 months, or for a longer period of time. Project delays may require an extension to the policy term.

Residential Renovations/Remodels: Homeowners or Builder’s Risk?

A Homeowners policy may provide some protection if a home is damaged for a covered loss during renovation work. However, most policies typically exclude coverage if the home is unoccupied or the renovations exceed a certain amount. Homeowners undergoing significant remodels or large-scale renovations should have a Builder’s Risk policy in place.

In addition, many carriers, particularly high-value home insurers, don’t cover renovation projects if the owner has waived subrogation rights against the general contractor, leaving the contractor vulnerable to subrogation claims by the owner’s insurer. This can be a significant exposure for larger homes. A Builder’s Risk Policy can be purchased on a contingent basis to cover the contractor’s property damage liability exposure.

Download our free eBook to continue reading.

Distinguished Builder’s Risk Pricing FAQs

Don’t see the answers you’re looking for up above? Here are some commonly asked questions about our Builder’s Risk policy coverage.

What Is The Max TIV For Your BR?

Max TIV depends on the project.

  • New Construction: Up to $10M (Frame construction up to $5M TIV)
  • Remodeler’s Risks: Up to $5M
  • Betterments Only: Up to $5M

With coastal projects, these limits are:

  • New Construction: Up to $20M (Frame brand new construction up to $6.5M TIV)
  • Remodeler’s Risks: Up to $20M (Frame remodeler’s risks up to $5M TIV)
  • Betterments Only: Up to $20M

What Policy Lengths Do You Offer For BR?

Distinguished offers Builder’s Risk policy terms of 3, 6, 9, 12 months, or longer.

Are There Any Types Of Buildings Distinguished Can’t Insure?

Distinguished will insure most building types, including both commercial and residential properties. However, we won’t be able to insure properties listed on the National Register of Historic Properties or projects that require underpinnings (vertical and horizontal additions can be considered).

As far as construction class limitations, they’re all fair game as long as the scope of work meets our program guidelines.

Can I Cover More Than One Property On A Builder’s Risk Policy?

We typically write one location policies. However, we’d consider multiple buildings for one location on a case-by-case basis. The key requirement is that the construction for all buildings starts and stops at the same time.

About Distinguished Programs

Distinguished Programs is a leading national insurance Program Manager providing specialized insurance programs to brokers and agents with specific expertise in Real Estate, Community Associations, Hotels, and Restaurants. Property and liability products are distributed through a national network of agents and brokers. Serving the same core markets and partnering with the most stable and reputable carriers, Distinguished Programs’ high-limit umbrella programs remain the clear choice in its areas of specialty for superior coverage, competitive pricing, and attentive service. Through thoughtful innovation, stemming back to 1995, Distinguished Programs fosters growth and opportunities for its brokers, carriers, and employees.

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