Builders risk insurance, also called course of construction coverage, protects buildings and structures under construction or renovation against damage from fire, wind, theft, vandalism, and other covered perils. For roofing contractors, builders risk is relevant when you are involved in new construction projects or major re-roofing jobs where the structure is exposed during the work.
On most commercial projects, the building owner or general contractor purchases the builders risk policy and names all subcontractors as insureds. However, on some residential re-roofing jobs or smaller commercial projects, the roofer may be expected to provide their own builders risk coverage. This is especially true when the scope involves a complete tear-off that leaves the structure temporarily without weather protection. A sudden storm during a tear-off can cause hundreds of thousands of dollars in water damage to the interior.
Builders risk policies are project-specific with defined start and end dates. Coverage typically begins when materials arrive at the site and ends when the project is substantially complete or the building is occupied. Premiums are based on the total project value, construction type, and location. When reviewing a construction contract, check Article 11 (in AIA documents) to determine who is responsible for builders risk. If the contract shifts that responsibility to you, factor the premium into your bid and arrange coverage before breaking ground.