Builders Risk Insurance
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What is builders risk insurance?
Builders Risk Insurance
A builders risk insurance policy, often called contract works insurance, covers the risks associated with construction projects. It is specifically designed to safeguard construction projects from unforeseen damages or losses.
Why would someone need a builders risk insurance policy?
Protection from Losses
Construction sites are bustling with activity and are prone to various risks. A minor mishap or an unforeseen event can lead to substantial financial losses.
Legal Requirement
In many cases, having this insurance can be a contractual requirement when undertaking a construction project.
Peace of Mind
Knowing that potential damages or setbacks will be covered allows project managers and owners to focus on the task at hand without the constant worry of potential financial pitfalls.
What exactly does a builders risk insurance policy cover?
A builder’s risk insurance policy typically covers:
Physical Damage or Loss: Damages to the structure being built, whether due to natural events like storms or human actions like vandalism.
On-site Materials: Covers materials and equipment stored on the construction site or transported to the site.
Temporary Structures: This can include scaffolding, construction trailers, and even temporary buildings erected for the project.
How do you obtain a builders risk policy?
To obtain a builder’s risk insurance policy:
Assessment of Project Value: Determine the total value of the project, including materials, labour, and other associated costs.
Select Coverage Duration: Policies can be short-term (for specific project durations) or annual (covering multiple projects or extended periods).
Work with an Insurance Broker: Engage with professionals like Gerrards to understand policy specifics and get the best coverage for your needs.
What are the advantages and disadvantages?
Builders risk insurance comes with its pros and cons.
- Comprehensive Protection: Safeguards against a wide range of risks specific to construction.
- Customizable: Policies can be tailored to fit the specifics of a project
- Cost: Like all insurance policies, there’s a premium to be paid, which adds to the project’s expenses.
- Exclusions: Not all risks are covered, like financial penalties from delays.
Common Misunderstandings
It’s the same as General Liability Insurance: While both are essential for contractors, general liability covers injuries and damages caused to third parties, whereas builder’s risk covers the actual construction project.
One policy covers all risks: Builder’s risk policies often have exclusions. It’s crucial to understand what’s not covered and consider additional policies if needed.
How can Gerrards help?
At Gerrards, we specialize in business insurance, and being based in New Zealand, we understand the specific risks and challenges of the construction industry in the region. Here’s how we can assist:
Expertise: Our team is knowledgeable about the nuances of builder’s risk insurance and can guide you through the intricacies.
Custom Solutions: We can help tailor a policy that fits your project’s specific needs and ensures comprehensive protection.
Claim Assistance: Should the unfortunate happen, our dedicated team will support you through the claims process, making it smooth and hassle-free.
