How to Purchase Builder's Risk Insurance

Builder's risk insurance, or construction risk insurance, is a type of property insurance that protects against any damage to your home or building while they are under construction. It also protects the materials and equipment used in the construction from loss or damage. Builder's risk insurance can be good to have if you are building or doing construction. Here are the steps to how to purchase builder's risk insurance.


  1. Image titled Purchase Builder's Risk Insurance Step 1
    Find an insurance company to buy builder's risk insurance from.
    • If you already have home insurance, the company that holds that policy is a good place to start. If you do not have homeowner's insurance, you can inquire with the company that you have renter's insurance or even automobile insurance with. Ask your agent if they offer builder's risk insurance and if he can give you a reduced rate since you already have your other policies with them.
    • You can also shop around and get price quotes from other insurance companies. Get quotes from a few providers and compare the prices. Do not be afraid to ask questions so that you completely understand what the policy covers. Make sure that you know how to go about filing a claim if you should need to and what the process is.
  2. Image titled Purchase Builder's Risk Insurance Step 2
    Fill out the application and other paperwork for the insurance policy you have chosen.
    • To complete the paperwork, you will need your contractor's name, business address and business license number. You should also know the size of your home and how old it is.
  3. Image titled Purchase Builder's Risk Insurance Step 3
    Send the application to the insurance company.
    • Be sure to make a copy for yourself and then send the original application and any other paperwork to the insurance company. You may be asked to submit a deposit with the application.
  4. Image titled Purchase Builder's Risk Insurance Step 4
    Wait for the application to be accepted.
    • The insurance company will review your application. If it is accepted, you will have to pay the balance on your premium once you receive a copy of your insurance policy.
  5. Image titled Purchase Builder's Risk Insurance Step 5
    Renew your policy if it will expire before the construction is completed.
    • If the term on your policy is coming up and you have not finished your renovation or construction, you should renew the policy before it expires. Builder's risk insurance usually will cover your building site and the materials for a year.
  6. Image titled Purchase Builder's Risk Insurance Step 6
    Convert your policy to Homeowner's Insurance.
    • In most cases, builder's risk insurance will convert to homeowner's insurance once the house is completed. Speak with your agent about this to make sure that it will convert or if you already have a homeowner's insurance policy and it is not needed.

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Categories: Insurance