Builders Risk Insurance Westwood, NJ
As a commercial contractor, you need to have insurance that guarantees that you will be able to meet your clients’ obligations on all projects. This means protecting not only your own commercial assets, but also the works in progress that are your responsibility. A unique commercial property insurance mechanism known as builder’s risk insurance will enable you to do so.
Johl & Company offers quality commercial insurance benefits to contractors of all shapes and sizes, and we can help you build a quality builder’s risk policy that protects all aspects of your operations. We insure contractors in Westwood, New Jersey and the surrounding areas. We will work hand in hand with you to make sure your policy is optimized to your advantage.
Common Builders Risk Questions
What is Builder's Risk Insurance?
Existing buildings are exposed to a wide variety of threats—fire, flooding, and vandalism are just a few of the ways building structures can be harmed. However, buildings under construction aren't ready to face risks that completed buildings can withstand. There's also the chance of an accident during the construction phase, like materials being destroyed or installed incorrectly. A proper risk analysis from our Johl & Company agents can help reduce the number of threats a new construction faces, and our agents can help reveal additional threats that may need to be covered by additional policies.
Builder's risk insurance is a policy designed to mitigate the chance of loss and protect you in the event that damage is done to the building. This policy is most commonly purchased by landowners and those funding the project, although some contractors purchase it in order to have more control over how each job is insured.
This policy is mainly designed for new construction, rather than changes and improvements to existing buildings. That form of construction is usually covered by property insurance and does not need any additional coverage, although it's best to talk with an agent before starting any particularly large project just to be absolutely sure it's covered.
What Does Builder's Risk Insurance Cover? What Does It Not Cover?
Builder's Risk Insurance generally covers the owner, the lending institution, the contractor(s) performing the work, and other related parties. In addition to providing coverage for damage to the building itself, most plans also cover temporary constructs (like scaffolding), materials, and equipment being used (whether it's currently on-site or off-site). The majority of policies are written on an all-perils basis, which means that reimbursements are available for any losses except those specifically excluded.
Common exclusions from this coverage include (but are not limited to):
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The value of the land itself
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Employee theft
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Damages beyond the estimated value of the construction
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Any losses brought by law or ordinance changes
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Damage from earthquakes
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Losses from war, nuclear hazards, or actions by civil authority
As you can see, most of the exclusions are not likely to occur during the course of a normal construction project. The value of the land is the only one likely to change as new work is done, and you will likely need to account for any improvements or losses the next time your company prepares taxes.
Do I Need a Builders Risk Policy?
A builder’s risk insurance policy can help you avoid the costly ramifications of cost overruns, unexpected property damage or similar delays in your work. With it, you can ensure that neither your own nor the client’s priorities are not met simply because a challenge arose that you didn’t expect.
There are several sub-specifications of coverage available to address the needs of different parties.
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New construction insurance applies to new construction projects and can apply from the moment you start your work on the property. It will apply until your complete the project.
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Remodeling insurance covers damage occurring to a property that is undergoing renovation. So, if you are revamping your master suite, coverage can assist you during the process.
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Installation insurance covers property before it gets installed into a permanent place. For example, if a contractor stores material at a worksite, and materials that they plan to use get stolen or damaged, then this coverage will pay for your recovery costs.
Additionally, some policies also offer premises liability insurance. This coverage will pay for bodily injuries or property damage that the policyholder might negligently cause to third parties, such as visitors to the construction site. However, other liability coverage within a contractor’s greater commercial insurance portfolio might also provide this coverage.
Builders risk insurance isn’t just for construction companies. It can help other businesses and even individual homeowners who want to undertake construction projects on their own. You should have coverage in place at least by the time you start the project.
Builder's Risk Insurance Policy Lengths
Most policies last until the building is no longer under construction. The exact point at which this occurs can vary—it may be when certain parts of the structure are done (but finishing work, like painting, has not been completed), up to the day it opens for business, or when the contract with the construction company ends. If you're worried about interim risks—like the building being damaged between when construction finishes and when it opens for business—talk to one of our agents and ask about extending your coverage.
For more information on if a Builder's Risk Policy is right for you contact us at (201) 664-2973 or fill out an online quote request form today!
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