Building or Renovating a Home? Put Insurance in Your Toolbox!

Searching for Builders Risk Insurance in Ontario?

Whether you’re building a new townhouse, cottage or doing major renos to an existing home, it’s always wise to protect yourself and your property with builders risk insurance in Ontario. At Insurance Hero, we offer customized, comprehensive coverage for building projects large or small.

Can builders risk insurance be extended?

Keep in mind, a builders risk policy can be flexibly written in terms of three months, six or twelve months. If your project isn’t finished by an initial policy term, it can often be extended to meet your requirements.

Why do you need builders risk insurance?

When you’re working on residential or commercial new construction/renovation projects, a builders risk policy covers the structure or insured area where your building is being constructed. Builder’s risk insurance is critical not only for projects of larger scale, but for any kind of build that puts your property and yourself at risk.

What does builders risk insurance cover?

Items and happenings typically covered include:

• Losses from fire
• Lightning
• Wind
• Theft
• Vandalism during construction
• Hail
• Explosion

In the case that one of these situations occurs during your build, your builder risk insurance will take care of:

• Value of building materials
• Cost of debris removal
• Any physical damage or loss to the property
• Soft costs such as legal fees or additional architectural costs

What does builder’s risk mean in insurance?

Builder’s risk insurance is a type of property insurance that provides coverage for buildings and structures under construction or renovation. It is designed to protect the property owner, the builder, and other parties involved in the construction process from financial loss due to damage or loss of the property during construction.

Builders’ risk insurance policies typically cover losses from a wide range of events, including fire, theft, vandalism, wind, hail, lightning, and other types of damage. In addition, builder’s risk insurance may also cover soft costs, such as financing and architectural and engineering fees, that are incurred due to a covered loss.

Coverage typically begins on the date construction begins and ends when the project is completed, and the property is ready for use or occupancy. The policy may also include extensions of coverage for a specified period after completion to cover damages that may occur during the final stages of construction or installation.

Does a builder’s risk insurance policy cover liability insurance?

Typically, a builder’s risk insurance policy includes general liability coverage. General liability insurance covers claims arising from third-party injuries or property damage on the construction site. 

However, in more specific circumstances, a separate liability insurance policy may be recommended or necessary to ensure they are protected from the unique risks involved with a particular project or contract. For example, some builders or contractors may also want or need professional liability insurance to protect themselves from claims related to possible errors, mistakes or omissions in their services.

Builders and contractors should carefully review their insurance needs and obtain appropriate coverage to protect themselves from potential liabilities and financial losses.

Is liability insurance mandatory for builders in Ontario?

In Ontario, builders have no legal requirement to obtain liability insurance. Nevertheless, some builders and contractors may need to obtain certain types of insurance if the contract stipulates it. For instance, if a builder is hired for a government-funded project, their contract may require them to purchase liability insurance, among others.

Similarly, a client may request proof of insurance from a contractor before they begin work, meaning they would need to obtain insurance coverage in order to secure the job.

Overall, it is highly advisable that all builders have insurance coverage, such as a builder’s risk insurance policy that typically includes liability coverage, even if it is not obligatory. Without insurance, builders could be held accountable for damages or injuries resulting from their work, which could result in significant financial loss.

What is a builder’s risk warranty?

A builder’s risk warranty is an endorsement that can be added to a homeowner’s insurance policy, covering them and their home for the duration of the construction or renovation. This endorsement can provide coverage for a set period of time on materials, systems and workmanship. 

A builder typically provides a builder’s risk warranty endorsement for new construction or renovation projects, and the builder assumes responsibility for addressing any structural defects that may arise during the determined period. Some warranties may offer up to 10 years of coverage, while others may offer one year. The duration of the warranty will differ depending on the nature of the project. 

At Insurance Hero, we understand the risks and challenges you can run into during a full-build project or custom renovation. That’s why we recommend having the right builders risk policy in place before any actual work begins. To explore tailored yet affordable builders insurance coverage in Ontario – contact a hero for more details.

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