| Any company involved in construction work, building | | | | on site. Tools, equipment, vehicles, materials and any |
| maintenance or installation and repair services is in | | | | other assets used on site may also be covered. For |
| need of contractors insurance. Contractors will be | | | | the amount of protection it affords (and the peace |
| ill-advised to forego contractor insurance in a climate | | | | of mind that goes with it) builder's risk insurance is |
| of high crime statistics, unpredictable weather | | | | relatively inexpensive (as against general liability |
| conditions, negligent workers, faulty equipment, | | | | insurance). |
| defective materials and a million and one other thing | | | | 2. Insuring Materials on site and in transit |
| that can go wrong in the contracting business. | | | | Given the cost of modern building materials, it is |
| There is also an ever-growing propensity to be held | | | | common practice for constructors to insure their |
| responsible and accountable for damages caused to | | | | materials either on site or while in transit. However, |
| third parties. Think about it this way: Insurance | | | | the onus is on builders to make sure that all |
| premiums cost a mere fraction of stolen materials, | | | | reasonable precautions are in place to protect |
| damaged projects or compensating clients or third | | | | materials from theft or storm damage as much as |
| parties for losses incurred through the negligence of | | | | possible. This coverage can also include materials |
| workers or the forces of nature beyond anyone's | | | | stolen in transit due to the vehicle being hijacked |
| control. By having the prudence and foresight to take | | | | while en route to the building site. |
| out builders' insurance, contracting businesses are | | | | 3. The most common insurance claims made by |
| safeguarding themselves against possible losses and | | | | contractors |
| lawsuits that could end up by severely crippling the | | | | The most frequent claims made by contractors entail |
| company financially or, in the worst case scenario, | | | | materials theft, damaged materials while in transit, |
| even bankrupting it. A contractor's policy actually | | | | storm damage, or surrounding properties being |
| costs very little in terms of premiums and is worth its | | | | damaged while construction is in progress. |
| weight in gold. | | | | 4. Most expensive Claims |
| The basics of builder's insurance | | | | The most costly claims most commonly filed by |
| 1. Builders' Risk Coverage (also known as construction | | | | contractor are usually damages incurred by third |
| coverage) | | | | parties and their properties due to the contractor's |
| Builders' risk insurance indemnifies the contractor for | | | | "negligence" for example, materials being blown off |
| losses or damages to a building while the building is | | | | structures in storms or high winds and landing on |
| under construction. Insurance usually covers the | | | | nearby cars or buildings. Also damage caused to |
| building for a specific time period and applies only | | | | existing underground pipes or cables. Other high |
| while the building is under construction. This type of | | | | claims are damages caused by fire, rainwater damage |
| insurance usually covers fire damage and vandalism. | | | | to structures, lightning damage or severe storm |
| The policy may also include materials in transit to the | | | | damage. All these liabilities can be covered by an All |
| building site as well as materials and equipment stored | | | | Risks contractor's policy. |