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Construction workers wearing hard hats, builders risk insurance

BUILDERS RISK

Builders risk insurance, for the construction period.

A specialized coverage for buildings under construction, major renovation, or remodel. Covers the structure, materials on site, and materials in transit during the build. Required by lenders on most construction loans.

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WHAT'S COVERED

What builders risk covers.

The structure under construction

The building or structure being built, including foundations, framing, roofing, and all components installed during the construction period. Coverage scales as the construction value grows.

Materials on site, in transit, and at temporary storage

Building materials before installation, whether stored on the construction site, in transit to the site, or held at off-site temporary storage. Critical given how much material value sits on a typical construction site.

Equipment and machinery installed

HVAC systems, plumbing fixtures, electrical equipment, and other building systems once they are installed at the project. Pre-installation equipment may be covered separately under installation floater.

Soft costs and lost income

Some builders risk policies include soft costs (engineering fees, permits, additional financing costs) and lost income if construction delays a planned rental or sale. Optional endorsements with specific limits.

IMPORTANT LIMITATIONS

Where builders risk policies have edges.

Faulty workmanship and design errors

The defective workmanship itself is excluded, though resulting damage to other parts of the structure may be covered. Defective design errors are usually excluded entirely; professional liability handles those.

Tools and equipment owned by contractors

Contractor-owned equipment (tools, power equipment, mobile machinery) is not covered under builders risk. That belongs on the contractor's inland marine policy.

Earthquake and flood

Standard exclusions. Coastal Georgia construction sites often need separate flood or wind endorsements. Earthquake is rarely material in Georgia given low seismic risk.

Vandalism after construction completion

Builders risk ends at the earlier of substantial completion or occupancy. After that, standard commercial property or homeowners coverage takes over.

OUR CARRIER PANEL

Carriers We Use for This Coverage

All carriers we work with hold an A or better financial strength rating and are appointed in the state. We compare them and recommend the right fit.

CLAIMS TIPS

If You Need to File a Claim

Practical guidance for the first 24 hours, what to document, common mistakes to avoid, and when to call us.

COMMON QUESTIONS

Frequently Asked Questions

Is builders risk required for Georgia construction projects?

Builders risk insurance is not required by Georgia state statute, but it is practically required by lenders financing construction. When a lender funds a construction loan, the building under construction is the collateral, and the lender requires insurance covering that collateral during the construction period. Standard homeowners or commercial property policies do not cover buildings under construction, so a specialized builders risk policy is required. Cash-funded projects (no lender) can technically skip builders risk, but the financial exposure during construction is substantial. A fire or major weather event during framing can wipe out months of work and material investment. For all but the smallest projects, builders risk is the responsible choice.

Most construction loans require it. Lenders typically demand builders risk as a condition of the loan because the building under construction is collateral. Cash-funded projects can skip it but should still consider it.

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Who is responsible for builders risk: owner or contractor?

Responsibility for builders risk should always be specified explicitly in the construction contract before work starts. The common default patterns: for owner-financed residential construction, the owner typically carries builders risk because they own the structure being built and are the loss payee on any insurance proceeds. For commercial construction, larger projects often have the general contractor carry builders risk as part of their bid, with the owner named as additional insured. Either party can name the other as additional insured to align interests. When the contract is silent, disputes can arise after a loss about who should have been carrying coverage. Best practice: write builders risk responsibility into the construction contract clearly, name both owner and lender as loss payees, and confirm policy bind before any site work begins.

Depends on the contract. Most residential construction puts the owner in charge of builders risk (it's their building). Commercial projects often have the contractor carry it. Always written into the construction contract.

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When does builders risk coverage end?

Builders risk policies are written for a specific construction period, typically 6, 9, or 12 months. The coverage ends at the earlier of three triggers: substantial completion (the construction is essentially done and the building is ready for use), occupancy (the building is being used for its intended purpose, like the owner moving in or a tenant starting business operations), or the policy expiration date. After any of these triggers, builders risk coverage stops, and the appropriate permanent policy must be in place. For a residential build, this means transitioning from builders risk to homeowners insurance the same day. For a commercial build, transitioning to commercial property or a business owners policy. Gaps in coverage at the transition can be expensive if a loss happens in the gap, so coordinate the changeover precisely.

At the earlier of substantial completion, occupancy, or a fixed end date in the policy. After that, standard homeowners or commercial property must take over.

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IN GEORGIA

How this works in Georgia

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GET STARTED

Starting a construction project in Georgia? Get builders risk before you break ground.

Most construction loans require builders risk as a condition. Coverage Review walks through your project scope, construction value, timeline, and lender requirements. We compare US Assure and other carriers in our review set to structure the right policy.

Builders risk pricing is typically a percentage of the total construction value, usually 1 to 4 percent of the project cost, depending on construction type, location, project complexity, and term length. Most Georgia residential builders risk policies for single-family homes run between $1,200 and $5,000 for a 6 to 12 month policy.

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