Builders Risk Insurance Coverage — Professional Protection

Builder's Risk insurance covers physical loss or damage to a structure under construction, including the building itself, materials on-site, materials in transit, and temporary structures. Standard covered perils include fire, lightning, windstorm, hail, theft, vandalism, and collapse. Coverage typically begins at groundbreaking and ends at project completion or occupancy, whichever comes first.

Either party can purchase builder's risk, and the contract typically dictates who is responsible. General contractors, developers, and owner-builders all commonly carry it. The policy should name all parties with an insurable interest — including lenders — as additional insureds. Soma reviews your contract requirements and structures the named insured schedule accordingly so there are no coverage gaps.

Standard builder's risk policies cover materials and the structure being built, but generally exclude contractor's tools and moveable equipment. A separate Tools & Equipment or Inland Marine policy is needed to cover owned and rented machinery. Soma routinely packages builder's risk with an equipment floater to give contractors comprehensive job site protection under a single program.

The policy limit is typically set at the completed value of the project, including all materials and labor. For renovations, it should reflect the total value of work being performed plus the existing structure if it's being covered. Under-insuring exposes you to a coinsurance penalty. Soma's specialists help you calculate the correct limit at inception to avoid coverage shortfalls at claim time.

Most builder's risk policies cover wind and hail as standard perils. However, flood and earthquake are typically excluded and must be added by endorsement or purchased as separate policies. For projects in coastal, flood-prone, or seismic zones, Soma proactively structures endorsements and excess coverage through specialty markets to close these critical gaps before construction begins.

Builder's risk policies have a defined policy period tied to the project completion date. If the project runs over schedule, the policy must be extended before expiration — a lapse in coverage creates significant uninsured exposure. Soma monitors your project timeline and initiates extensions proactively, preventing coverage gaps caused by construction delays, permit issues, or supply chain disruptions.

Yes. Soma specializes in placing builder's risk for projects that standard markets decline — including high-value commercial developments, mixed-use buildings, projects with prior losses, and complex multi-trade ground-up construction. Through carrier partners like Chubb, Liberty Mutual, and Kinsale, Soma accesses surplus and specialty markets with deep appetite for challenging construction risks.

Soma's risk management team is built for speed. For most builder's risk submissions, we deliver quotes same-day and can bind coverage before your next project milestone. We handle all application requirements, lender certificate requests, and named insured scheduling internally — so your project never stalls waiting for a broker to respond or a carrier to underwrite.