Does Builders Risk Cover Existing Structures?
Sometimes—renovation coverage must specifically include and value the existing building, which some forms treat separately from new work.
Builders risk can cover an existing building during renovation, but the policy must specifically include and value the structure; the cited ISO form treats it differently from the new work. An illustrative ISO form and contract clauses may treat existing property differently, so that general description does not establish coverage for a particular building. State the existing building’s value and occupancy separately from the new work. Confirm the policy includes the structure itself, identifies which portions are insured, and addresses damage from construction operations, occupied areas, water intrusion, and demolition. Check deductibles and limits for both old and new work. The owner’s existing commercial property policy may insure the building outside the builders risk scope, but construction activity can trigger restrictions or exclusions that should be discussed with that insurer. Request a schedule that separates the original structure from new work, and ask how damage to occupied or untouched portions is treated when renovation operations affect the building.
