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Let’s take a look at what is the right type of insurance for a building under construction.  Having the correct policy will determine whether you lose or make money. Two key insurance policies are Contractors Liability Insurance and Builder’s Risk Insurance. Moreover, as a contractor, you take adequate measures to protect your business from loss. However, the risks may not be covered by one policy. In this article, we will explore some of the key differences between the two policy coverages.

Builder’s Risk Insurance

Builder’s Risk offers coverage for structures under construction.  It can also extend to equipment and materials. Thus, this will include restructuring, a new construction project, remodeling, and installation of fixtures. Furthermore, yur Builder’s Risk will cover:


  • Damage caused by natural weather conditions 


A construction site isn’t shielded from weather elements. Consequently, insurance for a building under construction will cover damage from floods, wind, hail amongst others


Hail may damage newly installed windows. However, With insurance, you will get compensation for both labor and material costs.


  • Damage caused by vehicle or aircraft 


Some sites are close to highways, roads and even airstrips. Furthermore, your Builder’s Risk Insurance will cover the cost of fixing damage, replacing destroyed equipment and cleaning up


A car veers off the highway and goes right through your scaffolding site. However, with your Builder’s Risk policy, you’re covered.


  • Theft and vandalism insurance for a building under construction 


Jobsite theft costs the construction industry $1 billion a year. Other losses result from theft of material and fixtures or vandalism.


Imagine going to work in the morning to find that your lumber and cement has been stolen. Moreover, without Builder’s Risk to cover the replacement of materials your business will suffer.

Extension policies

Every good insurance agent will provide additional benefits to cover other scenarios. Moreover, these may include:

  • Debris removal
  • Loss of profit
  • Property replacement
  • Loss or damage of equipment both onsite and in transit
  • Temporary structures e.g. fence
Contractors Liability insurance

Contractors Liability protects your business from liability that may arise from third party bodily injury or property damage. It offers little insurance for a building under construction. Your policy covers:


  • Third party property damage claims


Contractors Liability protects your business from financial costs related to damages caused to third-party during property construction.


You are working on a client’s roof when your tools fall and damage their expensive marble floor. Luckily, your Liability Insurance will cover the cost of repairs.


  • Third-party injury claims


Your Contractors Liability covers injury claims associated with your operations or products. The policy will cover medical costs and loss of wages. However, the coverage doesn’t cover personal or employee injury.


A child falls over your toolbox and dislocates her arm. Your business is responsible for medical fees, and luckily you have Contractors Liability to cover these costs.


  • Advertisement mistakes


Contractors Liability covers the cost of liability lawsuits resulting from your advertisement activities.


You may use a picture of an employee working on your social media. A few days later a company owning one of the tools in your picture calls. They allege that your content has infringed on copyright.


  • To cover damage to premises rented to You


Due to the nature of construction materials and equipment, storage spaces are at risk of getting damaged. Your Contractors Liability will cover the costs of repair


If a shelf holding tools and heavy equipment falls over and damages the floor.

Get insurance for a building under construction and more

Both Builder’s Risk and Contractors Liability are crucial for your business.  Now that you understand the differences between the two, you need an insurance agent you can trust. Get in touch with Contractors Liability on 888-676-0923

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