At as little as 1% of total costs, Builder’s Risk policies are a great, cheap safeguard against the many external hazards faced in construction. You’ve probably got some coverage that protects against the basics – fire, wind, rain, crime and vehicles. But did you know you can easily add extensions to your coverage? This helps make your Builder’s Risk policy work better and save more money for your business. In this article, we’ll look at 5 possible extensions to your coverage.
5 Builder’s Risk Policy Extensions
1. Debris Removal
Most Builder’s Risk policies will cover repairs for the building in the event of a storm. But in construction, exposed structures mean big, moving parts. If your site gets strewn with debris, you’re expected to haul it out of your own pocket. Industrial dumpster rental alone can cost $900. An extension will pay for the whole disposal.
Similarly, if you do clear debris, perhaps you’d rather not dump it in a landfill. Green construction is a gigantic, growing global industry expected to hit $377 billion in 2022. The US has the largest market. More and more clients want to work with sustainable contractors.
An extension for debris recycling, renewable energy repairs, and air purification from third-party damages can help establish your reputation in this important sector. It’s a coverage extension that is increasing requested for Builder’s Risk policies.
Perils like fire, wind, rain and explosions can be seriously devastating on a construction site. Containers with paint, tar or other potentially toxic materials could get damaged, and seep into the soil or groundwater. Or, a fire could create hazardous fumes.
Pollution cleanup costs are immense, and contractors are more exposed than most. Standard Builder’s Risk policies won’t cover it. You can, however, add an extension that will pay for this. It’s especially useful if you work with lots of dangerous materials.
Delay of Completion
You just can’t control everything in construction. The risks are high and there are so many unexpected variables. Supply chain issues, weather events and equipment loss can all lead you to overshoot your deadlines. If the completed building would have brought 25% in revenue for your company’s next quarter, that’s 25% lost.
A common extension for Builder’s Risk policies will protect you against this. ‘Delay of Completion’ coverage means your insurance provider estimates what you’re going without, and covers it to see you through.
Water Build-Up Damage
Florida has 583,600 construction workers – the third-most in the whole USA. It also has 1.5 million people living on a FEMA floodplain and the highest summer rainfall. All this to say: water poses a serious risk to construction sites. And not just in Florida. 2019’s national rainfall was 30% above average and has risen 90% since 1950. What if you’re renovating a building and water builds up in clogged pipes on the 30th floor. If it leaks out over a weekend, seeping down to lower floors, imagine the damage that could do to your project. It could easily be millions of dollars.
A water build-up extension is small. But it is commonly added to Builder’s Risk policies for a good reason – water damage is really expensive.
Extensions For Builder’s Risk Policies
Different Builder’s Risk policies need different extensions. It depends on you. Every company faces its own unique set of risks, and is pretty safe from others. The easiest way to find the most effective policy is to speak to professionals who know your industry. Call Farmer Brown Insurance on (888) 973-0016 to get started.