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    Who Pays for Builder’s Risk Insurance?

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    who pays for builders risk insurance Canada

    Builder’s Risk plays an important role in protecting any job site that’s under construction. Find out who is responsible for purchasing this type of coverage.

    From ground-up new builds to large-scale renovations, Builder’s Risk insurance helps protect just about any project that’s under construction.

    Also known as Course of Construction insurance, this type of policy helps prevent gaps in coverage for buildings that are considered construction sites. This can include everything from major updates to a suburban home to the development of a brand new downtown skyscraper.

    Builder’s Risk can also help protect those who are financially involved in a construction project. But with more than one party benefiting from this type of coverage, it can be hard to know whose responsibility it is to buy it.

    In this article, APOLLO explains:

    • Who’s covered under Builder’s Risk

    • Who should buy this policy

    • What this type of coverage costs

    • How long Builder’s Risk is in effect

    Need Builder’s RiskInsurance?

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    Who Needs Builder’s Risk Insurance?

    The answer to this question is pretty much anyone who is financially involved in a construction job. That is, if you may face monetary loss due to an accident, property damage, or delay in the project, then you should protect yourself with Builder’s Risk.

    Even if you are not the one responsible for purchasing this type of insurance, you should consider requesting to be included on the policy if you are a:

    • Property owner/developer

    • General contractor

    • Construction manager

    • Subcontractor

    • Lender

    Related: How much does it cost to build a house in Canada?

    Covering the above parties under the same policy can keep everyone protected and aligned should the unexpected happen. It simplifies what needs to happen in the event of a claim, and can prevent disputes from arising between those who are financially invested in the project.

    Who Pays for Builder’s Risk?

    Although there are quite a few people who can be included in your Builder’s Risk insurance, there are only a few who typically buy it.

    For example, with APOLLO’s Builder’s Risk policy, the building owner, general contractor, or construction manager can all purchase the insurance coverage. In most cases, however, it is the building owner or the general contractor who buys it. This is because they are usually the most financially invested in a project and would face the greatest loss should something go wrong.

    While either the owner or the general contractor can choose to buy the policy, ultimately, it’s up to these two parties to come to a mutual decision on who will purchase it.

    How Much Does Builder’s Risk Cost?

    Every construction project is unique, making it difficult to assess an average or standard price for this type of policy.

    That said, you can determine an estimate for your project by calculating the total completed value of your structure. The amount of coverage you need is typically based on this number. From there, you can assume that your premium will work out to be a small percentage of that total number.

    It’s important to remember, however, that it’s not always as straightforward as above. The cost of your insurance may be affected by your policy exclusions, how your project is classified, and the term of your policy.

    How Long Does Builder’s Risk Insurance Last?

    Coverage for this type of policy usually starts when the project breaks ground and continues until construction is complete. A job is considered finished once the new owner signs off on completion of the project.

    With some policies, like APOLLO’s Builder’s Insurance, you can also choose to backdate your coverage up to 14 days. Our coverage also offers a policy period of up to 24 months.

    Looking for Builder’s Risk Insurance for Your Project?

    Finding the right insurance policy for your project can feel overwhelming and, at times, confusing.

    Discover how you can cover your residential and commercial building projects in minutes with our quick, easy, and entirely online application process.

    APOLLO Has You Covered

    Get the protection you need in minutes with custom Builder’s Risk Insurance from APOLLO.

    Learn More

    Originally published April 4, 2022, updated August 25, 2023

    Back to APOLLO Magazine
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