General Liability Insurance Vs Builders Risk
If you’re in the construction business, it’s important to choose the right insurance policy. A builder’s risk policy protects the building site, while a general liability policy protects individual contractors. If you’re not sure which to purchase, talk to an insurance agent. A general liability insurance policy will help you avoid financial disaster if you’re sued for negligence or damage to other people’s property.
When choosing between general liability insurance and builders risk insurance, remember that each policy contains a different list of exclusions. Generally, a builders risk policy excludes a number of events that don’t fall under a general liability policy, such as sinkhole collapse or earth movement. Some policies also exclude government seizure of property. However, this rarely occurs outside of a war or political uprising.
General liability insurance coverage is not as comprehensive as a builder’s risk policy. It typically covers the building under construction, materials, and equipment, but doesn’t cover injuries sustained by employees or property damage. However, general liability coverage can cover external events, such as vandalism, and exclude injuries caused by a builder’s negligence. However, it does not cover soft costs, advertising injury, and employee theft.
When comparing general liability insurance vs builders risk insurance, the first thing to consider is the provider of the policy. A general liability policy is usually the cheapest, while a builders risk policy is more expensive. The Hartford offers both types of insurance, and the Hartford website includes a tool that lets you search for local agents. However, there are few online builders risk providers.
General liability insurance is an ongoing expense for most construction companies. It helps cover the legal fees and settlement costs incurred when a lawsuit is filed against the company. In addition, a general liability policy protects lenders from loss in case of accidents. In many cases, a lender will require that construction companies have specific general liability insurance coverage to receive a construction loan. If the applicant does not have sufficient insurance, the lender should review the insurance policy prior to closing the construction loan. You can also verify the level of coverage through requesting a copy of the insurance policy.
A CGL policy covers a wide range of potential risks. While the number of loss occurrences may be few, even one single incident can have a significant impact on a lender. It can lead to broken trust, reputational damage, and legal problems. In addition, a general liability policy can protect the lender against financial loss, including loss of collateral.
While general liability insurance covers structures that have been built, a builder’s risk policy protects structures that are under construction. It also covers the risks posed by renovating or adding new structures. A builder’s risk policy is designed for new construction, which poses unique risks compared to established structures.
General Liability Insurance Vs Builders Risk – Get A Quote Now
- Contractor Risk Coverage :
Contractor Risk Coverage is an important part of your construction insurance strategy. Large construction firms need specialized insurance policies to protect themselves from large losses. They buy the same insurance coverage as medium-sized contractors, but they have special needs, such as wrap-ups and OCIPs. If you’re not sure what type of coverage you need, consider contacting an experienced Commercial Risk Advisor. Pascal is an experienced Commercial Risk Broker with expertise in construction. - Contractor Compensation Coverage :
If you own a construction company, you should make sure that you have Contractor Compensation Coverage. In many states, a general contractor is required to carry this insurance in order to provide workers’ compensation to injured workers. Without it, the business would be responsible for the injured employee’s medical bills and lost wages.
- Contractor Installation Coverage :
Contractor installation coverage is a type of insurance that protects you if you are found legally liable for damage to property. This type of coverage covers medical expenses and damages incurred by your employees or customers and extends to legal and court costs. The costs of this insurance vary but can save you money in the long run. - Contractor Tools Coverage :
If you own equipment that you use for your business, you should consider purchasing contractor tools coverage. This type of insurance provides coverage for tools that you already have and any tools you purchase in the future. This type of insurance policy covers any type of equipment, including hand and power tools, including trailers. This type of insurance also covers your tools when they are off your property.