Builders Risk insurance is used to insure buildings under construction.

Builders risk coverage is written for a minimum one year term to cover a new building or structure under construction or an existing structure undergoing additions, alterations, or repairs.

Policy inception should begin no later than the date that construction "starts above the level of the lowest basement floor" or, if there is no basement, the date construction begins.

The amount of coverage is based on the value of the building upon completion (including the value of permanent fixtures and decorations). Insurance on that value is provided from the outset of construction until coverage ceases.

When Coverage Begins & Ends
When coverage begins: Coverage begins once any materials are delivered to the construction site. Materials are defined as the supplies and resources that will be part of the complete structure and include the foundation and footings.

For a reporting form policy, a new start is covered only when all of the following conditions are met:

• The start is reported on time

When coverage ends: The following conditions will terminate coverage:

• Once the insured`s interest in the property ceases.
• With annual reporting forms, if the building is not re-reported and additional premium is not paid at the end of 12 months from the month when the builder first reported the start.
• With monthly reporting forms, if the building is not re-reported and additional premium is not paid at the end of the month following the month when the builder last reported the start.
• Ninety days after occupancy of a single- occupancy structure, unless building is being used as a model home or is being used as a model home leaseback and the appropriate policy is issued.
• If the building is leased or rented to others.
• For multiple family dwellings, when more than 50% is leased to or rented to others. For commercial structures, when more than 75% is leased to or rented to others.
• If the reported project is abandoned.