When Do You Need Course of Construction Insurance?

Course of construction insurance, often called builder’s risk insurance, is property coverage designed for the period when a building is being constructed or substantially renovated. It can protect the work in progress, materials and other insured project property against covered loss or damage while the project is underway. Whether a particular project needs a separate builder’s risk policy depends on the existing property insurance, the construction contract, the lender’s requirements and the scale of the work. Insurance Bureau of Canada cautions that standard property policies are designed for occupied properties and that planned construction or renovations should be disclosed because coverage terms may change and builder’s risk coverage may be required. A new building presents a different property risk from a completed, occupied building.