Construction
projects involve significant financial risk for the contractors and
subcontractors who must pay workers and purchase materials. To help
protect themselves against these financial losses, builders have a
number of insurance options. Two of the most widely used coverages are
Builders Risk and Installation Floaters. The choice you make depends on
the nature of each job.
Builders Risk insurance pays for damage to materials or
partially completed work due to accidents, fires, weather damage,
material defects, and incorrect installation or workmanship. This
coverage ensures that the time and money that the builder has invested
in the project aren't lost when the costs of repairing, repurchasing or
reconstructing add up and diminish profits.
Installation Floaters cover specific items that a contractor
is planning to install. For example, a roofer might buy a policy to pay
for the cost of roofing supplies, both during transit and while stored
at the work site. An Installation Floater covers either all risks or
specific sources of losses for moveable property (materials or
equipment) specifically named in the policy.
Because of its more narrow coverage, an Installation Floater
generally costs less than a Builders Risk policy. However, it leaves the
builder more vulnerable to losses that aren't covered. This coverage
would be appropriate for a contractor performing a specific installation
task, or a subcontractor who takes on limited risk to perform a
specific duty for a contractor as part of a larger project.
As Construction insurance professionals, we'd be happy to recommend
the type of coverage best suited to protect you against losses on each
job. Just give us a call at any time.