Builders Risk vs. Construction Insurance: What’s the Difference?

“Construction insurance” may mean a package of policies; builders risk covers property for a described construction project. The NAIC’s definition includes buildings in progress and certain related property, while liability, workers’ compensation, and auto address different risks. Ask for every policy and limit in the package before deciding whether it meets your contract requirements.

A proposal labeled construction insurance may bundle coverages, but a package name does not show which risks or parties are included. The specimen ISO builders risk form covers specified property for a described project and excludes some categories such as contractor tools. Liability and employee-injury risks need their own terms.

Ask for a schedule of all policies, insurers, limits, and forms. Identify whether materials, existing structures, tools, vehicles, subcontractors, third-party injury, and employee injuries have protection. Check exclusions and deductibles across the package and verify that the project dates and entities match the construction contracts.