What Is Builder's Risk Insurance and When Do You Need It?

Written by Aaron Ameduri | Sep 22, 2026, 8:21:38 PM

Last reviewed: September 22, 2026

Builder's risk insurance covers a structure while it's under construction or major renovation, including framing, materials on site, and often materials in transit. It's a short-term policy that runs for the length of the project, not a year-round policy like your regular property coverage.

When you actually need it

New construction, ground-up
A major renovation or addition that changes the structure
Not usually needed for cosmetic work, like paint or flooring, where the building itself isn't structurally exposed

What it covers

Materials and structure on site
Materials in transit to the site, in most policies
Theft and vandalism during construction
Fire and weather damage mid-build

What it typically excludes

Tools and equipment, which usually need separate contractor's equipment coverage
Workers' injuries, covered under workers' comp instead
Faulty workmanship itself, though resulting damage from it may be covered

How it's priced

Estimated completed value of the project
Project length
Construction type and location

Who buys it

General contractors and developers doing ground-up construction or major additions. A homeowner doing a full teardown-rebuild needs it too, not just commercial GCs.

Common questions

Does my regular property policy cover a building under construction? No, most standard property policies exclude buildings under construction. That's exactly what builder's risk is for.

Who should be named on the policy, the GC or the owner? Depends on the contract. Often both are named insureds. Worth checking your contract's insurance requirements before the policy is written.

Send me the project details and I'll get you a quote before you break ground.

— Aaron