If you are in the construction business, there are some insurance policies you must carry to protect yourself. Workers’ Compensation Insurance and Commercial Auto and Truck Insurance are two examples. But there’s another lesser-known type of coverage that can be a lifesaver if a building you’re working on and/or your construction materials are damaged during construction: Builders Risk Insurance. You can purchase these policies for varying time frames, and coverage ends when the project is complete. Read more
Life just wouldn’t be the same without some risk. People all over the world enjoy pushing themselves to the limits. And, that means crossing the danger and risk threshold from time to time. It can be downright exciting (or terrifying) depending on who you are. But, regardless of whether you enjoy danger or abhor it nobody wants to experience that level of risk on a daily basis (and then have to deal with the repercussions). Contractors of all shapes and sizes experience high levels of risk every day (which can weigh heavily on you as a contractor). To lessen that weight and to help you focus less on what can damage your business and more on what can help it succeed you may want to consider acquiring contractors All Risk Insurance. It could be your savior if you find yourself in a sticky situation.
Contractors All Risk Insurance
True to its’ name contractors all risk insurance is designed to protect you against certain risks that could pose a significant threat to your business. But, what threats and risks are covered? That is an important question. So, to answer your questions, all risk insurance will cover you in the event of damage to civil projects that are under construction. Coverage extends to fire and allied perils, flood, earthquake, collapse, water damage and human error (which is pretty limitless).
Unfortunately, contractors all risk insurance will not cover any and all losses that you may experience. For example, war time and nuclear risks are not covered as well as normal wear and tear or bad workmanship. Coverage may also depend on the extent of protection that your insurance provider provides for you. So, you will want to go over coverage limits with your provider before you walk out of their office just so you know exactly what is covered (as well as what isn’t).
Nobody makes anything with their hands anymore (or at least not a majority of people). America was once the nation where everything was built. If you wanted a fighter plane, a car or a computer you came to America. If you could name it, we could build it. And, while that still might be true, most of America sits behind a desk and stares at a computer screen for most of the day. That’s not to say that that isn’t work, important things happen behind desks, but that same innovative, no nonsense builders spirit that made the United States is what it is today is hard to find. That is, unless you look at our contractors and see the risks that they take to build our countries future. Those risks can be overwhelming at times but still, they press forward. And while you might feel helpless to protect them, there is something you can do; convince them to acquire all risks insurance.
All Risks Insurance – What is it?
Contractors are exposed to all kinds of risks during their day to day activities. And all it takes is one lapse in concentration to turn a high risk situation into a traumatic situation. To counter that risk you’re going to need an over-arching insurance policy that can protect you in a variety of different ways from a variety of different variables. Essentially, the policy will cover any losses that may not be covered by an ‘excluded peril.’ All risks insurance typically breaks down into two different forms (which we have listed below).
1. Property Damage
This policy is designed to protect you and your contractors in the event that you (or someone else, or Mother Nature) causes damage to a building or structure that is currently being constructed.
2. Third Party Claims
The second part of all risks insurance serves as a barrier between you and any claims made by a third party (or if someone walks through your workplace, trips and then tries to sue you for their injury). That way you can focus more on your business and less on problems that you shouldn’t have to deal with to begin with.
All risks insurance is becoming a staple for contractors across the country so, if you are currently without, then you may want to consider talking to an insurance advisor to make sure you are adequately covered. If you have any further questions please feel free to give us a call at 1-800-649-9094. We look forward to hearing from you!
Builders Risk Insurance
Though the Great Recession ended in 2009, many businesses are still acting as though the recession never ended. Great financial tragedy often results in people being more cautious with how, where, and when they spend their money, but that is not necessarily a bad thing. Yes, it results in economic hardship over the short term if people are left with less disposable income, but restricted access to capital forces both individuals and businesses to address their problems with a greater degree of creativity, which can spur long term growth. The insurance industry is currently in the process of re-inventing the way it conducts its business through the creation of individualized and flexible payment plans for contractors. These business risk insurance plans have emerged due to the demand created by builders who have moved from big projects to much smaller projects such as home renovations and remodeling.
Flexible Payment Plans
With contractors shifting to smaller projects, the insurance industry adjusted its policy forms and coverage options because nobody was building. No building meant no one was buying insurance, and with nobody buying builders risk insurance, the industry needed to shift its plan of attack. These new programs involved paying lower premiums and paying in installments rather than contractors having to front most of the money before they started the project. “Pay-as-you-go” insurance plans give builders the luxury of deferring a payment until the time of sale thereby allowing them to use the profit they make off of their project to pay for completed operations coverage.
Companies like Cove Programs in Los Angeles are sponsoring change by offering flexible policies for smaller builders. Just this past year, they introduced a variety of new policies that offer general liability and builders risk insurance on an annual, multi-year, or project basis. These policies cover everything from single-family detached homes to apartment projects; it just depends on the needs of the builder. Cove designed the programs around the business plans of the contractors they were working with instead of forcing the policy around the standard one to two year period. Through such flexibility, insurance companies are helping get contractors back on their feet and are hoping to see further growth in the months and years to come.