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Contractor Builders’ Risk checklist – are your interests protected?

builders' risk

Why do you need builders’ risk insurance for your New Hampshire or Vermont construction project?

Builders’ risk insurance provides coverage for your next construction project. Whether the builders’ risk insurance is for an addition to your Vermont farmhouse or a new build for a new family home in New Hampshire, anyone with an insurable interest in a new construction or renovation project can buy builders’ risk (or “course of completion”) insurance.

Homeowners in Vermont and New Hampshire should be aware of this coverage and talk to their insurance agent before the project to make sure they have the proper coverage in place.

Unlike homeowners, commercial property, or general liability insurance, builders’ risk insurance lasts only for the project’s duration. Builders risk is a combination of insurance types with broader coverage and highly customizable language to suit the nature of your project.

Who should get Builders’ Risk Insurance?

A builders risk policy protects the homeowner from loss during the construction or building phase. After it is complete, the builders’ risk policy goes away, and the homeowners’ policy takes over. If you are renovating or doing an addition to your Vermont or New Hampshire home, make sure you discuss the details with your agent to make sure your homeowners’ policy takes the changes into account.

For building contractors in New Hampshire and Vermont, we recommend that you maintain your own builders’ risk policy for your New Hampshire or Vermont project and, if possible, make sure the owner’s policy picks up where yours ends. You may want to name multiple parties on your insurance policies in some instances.

Transparency about insurance coverage creates a layer of protection that helps maintain a smooth transition from construction to ownership. Unexpected loss during this time may feel unlikely, but storms, theft, and even fire can cause damage and loss on any construction site. Take the necessary steps to make sure coverage is in place through the entire lifecycle of the project and, most importantly, during the time of transition.

What does builders’ risk insurance protect?

In addition to the homeowners, investment firms and lenders obtain builders’ risk insurance to shelter their financial investment in the completed structure. Typically, their risk begins when they take ownership of a completed project.

A general contractor buys builders’ risk insurance to protect their materials and equipment during the building process. Their risk begins when the project materials are purchased and ends when ownership of the structure is transferred.

Each of these groups might not understand (or care about) the unique risks of the other party.

Vermont and New Hampshire Builders Risk Checklist

Use this checklist to determine your risk exposures. We’ll help you close the gaps with specialized insurance built for your business.

  • Check your risk liability exposures
  • Does your builders’ risk policy begin before building materials are delivered to the project site?
  • Does your contract with the municipality, city, or lender require you to secure insurance? If so, are your limits high enough? Is your coverage broad enough?
  • Do your projects involve green or Leadership in Energy and Environmental Design-certified (LEED) properties? If so, do you have green upgrade coverage for replacement materials?
  • Does your policy cover the actual cash value (value less depreciation) or replacement value (value using current prices) of materials?
  • Do you have tailored coverage limits to reflect potential soft costs (additional wages, lost income, lease extensions, expedited expenses, advertising, blueprints, overhead, consultation fees and inspections) if a project is delayed?
  • Do you have coverage for temporary fixtures such as cribbing, fencing, signage, and scaffolding?
  • Are you a project investor or owner? If so, you’ll need additional insurance to extend coverage beyond the completion of construction.
  • Have you determined the time element coverage? The time element names a period of indemnity and restoration if a catastrophic loss occurs during construction or the ramp-up period. Time element coverage typically includes the time it will take to recover and rebuild after a loss. It provides for the contractor’s lost business income and may also account for the lost income of the owner.
  • Is there a “permission to occupy” exclusion in your policy? This exclusion can be a problem if you’re working on a project where people are allowed to inhabit certain parts of the structure before construction is complete.
  • Do you have environmental protection and pollutant cleanup insurance in case of an accidental chemical release?
  • Do you have completed but vacant structures that need to be insured until they’re sold?
  • Do you employ workers?
  • Do you use subcontractors such as plumbers and electricians?
  • Are you and your subcontractors’ named insureds on the owner’s insurance policy?
  • Are the owner and subcontractors listed as named insureds on your insurance policy?
  • Is there a waiver of subrogation provision for the insurance policies covering your projects?
  • Do you have coverage for equipment breakdown or damage, which can result in costly delays?
  • Do you have coverage for subcontractors’ equipment and materials if they’re damaged or stolen from your job site?
  • Does your insurance protect your profits if you experience a loss during construction? Does it cover the total value of an unsold dwelling?
  • Do you have ordinance or law coverage if your structure suffers a partial loss and the building code requires you to rebuild the undamaged parts?
  • Do you have coverage for debris removal after a covered loss?
  • Do you have coverage for the testing of building systems?
  • Do you have flood insurance (including mudslides)?
  • Do you have earthquake or earth movement coverage?
  • Do you have business income protection?
  • Do you transport machinery, materials, or equipment between job sites? Ask about a blanket policy.
  • If you’re involved in a renovation project, does your insurance cover the existing structure and the improvements?
  • Does your policy cover valuable papers and records?
  • Are your equipment, machinery, and materials covered for sewer backup, drain, and sump overflows?
  • Issues Not Covered by Standard Builders Risk Insurance


A builders risk policy will cover your Vermont new construction or New Hampshire renovation project through completion. But you should also know how to insure your project after completion. While these policies are not typically included in builders’ risk insurance, they can help you limit your business risk exposure.

Type of Insurance

What it Covers

Contractors professional liability, or errors and omissions
Negligence, construction errors, undelivered work, misrepresentations and sometimes mistakes made by third parties involved in your project
Commercial general liability
Bodily injuries, property damage and advertising injuries to people not employed by you
Workers’ compensation
Injuries sustained by employees while on the job
Employment practices liability
Employee claims of discrimination, harassment, wrongful termination, breach of employment contract, sexual harassment, negligent evaluation, deprivation of career opportunity, or failure to employ or promote
Commercial auto
Accidents and damage to or caused by vehicles your business owns
Inland marine
Equipment, machinery and materials in transit
Contractors tools and equipment
Equipment damaged, vandalized or stored on-site
Employee theft, or crime and fidelity
Theft of money and other property by a direct employee (first-party coverage) or an independent contractor or subcontractor (third-party coverage)
Cyber liability or data breach
Unintentional breaches of clients’ or employees’ personal information, or hacks resulting in data or computing losses and associated fines

Talk to an agent about builders’ risk insurance for New Hampshire and Vermont homeowners and builders.

Ask us about construction risk packages. An insurance bundle could offer broader coverage or lower premiums for year-round coverage. Get insured before you begin your next construction project — we’re here to help you seal the gaps. Give us a call today!

Unintentional breaches of clients’ or employees’ personal information or hacks resulting in data or computing losses and associated fines

Give us a call

Ask us about construction risk packages. An insurance bundle could offer broader coverage or lower premiums for year-round coverage. Get insured before you begin your next construction project — we’re here to help you seal the gaps. Give us a call at 800-392-6532.


This content is for informational purposes only and not for the purpose of providing professional, financial, medical or legal advice. You should contact your licensed professional to obtain advice with respect to any particular issue or problem.
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