During the course of construction, Builders Risk policies cover buildings and other structures and personal property exposed to direct property loss. Damage can come from obvious perils such as fire wind, flood, etc. It can also come from faulty workmanship or design error.
Your Builders Risk policy should include all fixtures, materials, machinery, and equipment that constitute a permanent part of the structure. Make certain there is coverage for damage to foundations, including pilings, since this can be a significant loss exposure during construction. The policy should also cover equipment, machinery, materials, etc., that have not been installed but which are destined to become a permanent part of the structure. Builder’s Risk will also include coverage for damage to property of others for which the insured may be liable.
Builders risk coverage normally remains in effect until the entire construction process is completed, at which time the project owner’s permanent property policy should become effective.
Installation floaters, often written in conjunction with builders risk policies, are generally associated with plumbing, heating, cooling and electrical systems, but can insure any property being installed. Carpeting, tile, glass window frames, elevators and machinery are examples of property that can be covered.
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