When it comes to protecting your investment during and after the construction of your new home, understanding the difference between builder’s risk insurance and home insurance with finished building coverage is key. As an independent insurance agency, our role is to guide you through these options and outline how your needs may change from the start of construction through project completion—and beyond.
Builder’s Risk Insurance: Protecting Your Project While It’s Underway
Builder’s risk insurance is specifically designed for homes or properties that are still under construction. This coverage can protect against financial loss from risks such as fire, theft, vandalism, or certain weather events during the building phase. If construction materials are stolen from the site, or if a storm damages the unfinished structure, builder’s risk insurance can help you recover these losses.
Typical situations where builder’s risk insurance may apply include:
- Building a custom home from the ground up
- Adding major structural additions or renovations
- Constructing detached structures like garages or guest houses
Finished Building Coverage: Transitioning to Home Insurance
Once your home is completed and ready for occupancy, builder’s risk insurance is generally no longer needed. At this stage, you’ll want to transition to a traditional home insurance policy. Home insurance provides broader protection for a finished residence, including:
- Coverage for damage to your home and personal belongings
- Liability protection if someone is injured on your property
- Loss of use coverage, which can pay for living expenses if your home becomes uninhabitable due to a covered event
Imagine you’ve finished building your new home and moved in: if a water pipe bursts causing damage, home insurance is designed to help with repairs and replacement of damaged items.
How an Independent Agency Can Help
We understand that navigating these transitions can be confusing. Working with an independent insurance agency means you’ll receive personalized attention and access to multiple insurance carriers, allowing us to recommend options that fit your timeline and specific coverage needs. We’re here to make sure you’re covered at every stage—whether your home is still going up, or you’ve just turned the key in the door for the first time.
