About $105 a month
Builder’s risk
Insureon median for small-business customers, updated July 2026
Coverage guide
Builder’s risk insurance
For contractors, developers and owners building or renovating: what builder’s risk covers, what it costs, who buys it under the contract and what to have ready for a quote.
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What similar businesses pay
- Builder’s risk
- About $105 a month
- Typical annual premium
- $350 to over $7,000 a year
- Example: $300,000 build
- $3,000–$12,000 for the project
Published benchmarks, not quotes. Your price depends on underwriting.
Cost
What builder’s risk insurance costs
$350 to over $7,000 a year
Typical annual premium
Insureon range for small-business customers, updated July 2026
$3,000–$12,000 for the project
Example: $300,000 build
Illustration applying Insureon’s typical 1%–4% of completed project value, July 2026
Insureon reports that its small-business customers pay a median of about $105 a month for builder’s risk, roughly $1,259 a year (updated July 2026); 49% pay under $100 a month. Most annual premiums run from about $350 to over $7,000. Insureon puts the typical cost at 1% to 4% of the structure’s total completed value, which counts materials and labor but not land, so a large commercial build costs far more in dollars than a garage or an addition. Frame construction, a coastal wind zone, a long schedule and added flood, earthquake or soft-cost limits push the price up; a short masonry job on a fenced, alarmed site tends toward the low end.
What moves your price
- Total completed value of the project, including materials and labor but not land
- Construction type: The Hartford treats a building with more than 35% combustible structure as frame
- Location: coastal wind in Florida and Texas, earthquake and wildfire in California
- How long the project runs before completion or occupancy
- All-risk (open perils) versus named-perils form, and the deductible you choose
- Added limits for flood, earthquake, wind, soft costs and lost rental income
- Site protection: fencing, lighting, alarms, watch patrols and distance to a hydrant and fire station
Who it’s for
Who needs builder’s risk insurance
Your construction lender requires it
Insureon notes that lenders may require builder’s risk with the lender as loss payee. For SBA 7(a) loans, Partner ESI’s SOP 50 10 8 checklist says builder’s risk may satisfy the hazard insurance required on collateral still under construction.
The contract says who buys it, and it may be you
Under AIA A201-2017 and its Exhibit A, the owner buys builder’s risk unless the contract shifts the duty. If the owner will not buy it, A201 section 11.2.2 says it must tell the contractor in writing before work starts; the contractor may then buy cover and charge it to the owner by change order.
Copper wire and lumber vanish overnight
Insureon gives the example of an electrician claiming for thousands of dollars of stolen copper wire. The Hartford’s application asks how copper is protected and whether the site is fenced, lit and patrolled.
A fire takes the open framing
Fire is a core builder’s risk loss, and underwriters look hard at how you prevent it. The Hartford’s application asks whether hot work is part of the job and, if so, for a written fire prevention plan, along with the distance to the nearest hydrant and fire station.
Water gets in before the building is closed
Insureon lists wind, rain and hail among covered losses and gives the example of lumber damaged by freezing rain. The Hartford asks for a water damage prevention plan and whether it uses sensors or shut-off valves.
A loss pushes back the opening date
Rebuilding after a fire adds interest, fees and lost rent the owner still owes. These soft costs need their own limit: Travelers’ Construction Pak form includes $100,000 automatically, and The Hartford quotes soft costs and rental income with a waiting period.
Coverage
What builder’s risk insurance covers
The building under construction or renovation
Repairs or rebuilds the structure after fire, wind, theft, collapse, lightning, hail, explosion or vandalism, the perils Travelers lists.
Materials on site, in transit and in storage
Covers lumber, fixtures and supplies at the jobsite and, depending on the form, in transit or stored off-site, as IRMI notes most policies do.
Equipment awaiting installation and testing
Covers equipment before and after it is installed. The Hartford adds cover while new equipment is tested and quotes hot testing separately.
Temporary works
Scaffolding, fencing, cribbing and falsework, which The Hartford names as covered temporary structures.
Labor, overhead and fees
Travelers says the policy typically pays reasonable labor, overhead and profit and expenses such as permit fees lost in a covered loss.
Debris removal
Pays to clear burned or collapsed work so rebuilding can start.
Soft costs and lost rent
Optional cover for extra interest, fees and rent lost when a covered loss delays completion. Check the limit and waiting period.
Property of others
Covers owner-supplied or subcontractor materials at the site, per The Hartford.
What it doesn’t cover
- Contractor’s tools and equipment, which need inland marine (tools and equipment) coverage
- Flood and earthquake unless added; Insureon says natural disasters usually need an endorsement
- The cost of fixing faulty design, defective materials or poor workmanship itself
- Injuries to workers, which fall under workers’ compensation
- Injuries to visitors or damage to neighbors’ property, which fall under general liability
- The existing building you are renovating, unless the policy schedules it
- Loss after completion or occupancy, unless the policy grants permission to occupy
Rules
Requirements and filings
Builder’s risk is usually required by a contract or a lender rather than by statute. The most common standard is AIA A201-2017 with the A101-2017 Exhibit A insurance terms; lenders and loan programs add their own conditions.
| Requirement | Applies to | What it means |
|---|---|---|
| Who buys builder’s risk | Owners and contractors on AIA A201-2017 contracts | The owner buys it, pays premiums and deductibles and adjusts claims unless the contract shifts the duty, per IRMI’s review of A201 section 11.2 and A101 Exhibit A. |
| Policy form and insureds | Owner-purchased builder’s risk under AIA Exhibit A | Section A.2.3.1 calls for an all-risks, completed value or equivalent form naming the owner, contractor, subcontractors and sub-subcontractors as insureds. |
| Perils that cannot be excluded | AIA A101-2017 Exhibit A | Section A.2.3.1.1 lists perils such as earthquake and flood that may not be excluded, and requires cover for damage resulting from defective design, materials or workmanship. |
| Owner does not buy it | Contractors on AIA A201-2017 contracts | Section 11.2.2: the owner must give written notice before work starts; the contractor may delay, buy its own cover and charge the cost by change order. |
| Existing structure on renovations | Remodels and additions under AIA Exhibit A | Section A.2.3.3 requires the owner to insure the existing building on an all-risks, replacement cost basis until the correction period ends. |
| SBA 7(a) construction loans | Borrowers using loan proceeds to build | Hazard insurance is required on collateral; builder’s risk may satisfy it during construction. For construction of $350,000 or less, one listed option is a 100% performance and payment bond with builder’s risk and workers’ comp (Partner ESI, SOP 50 10 8). |
Compare builder’s risk insurance options.
One application, quotes from several insurers, reviewed by a licensed agent. Start with your email and finish later if you need to.
Pay less
How to lower the cost
- Settle in the contract who buys builder’s risk before you bid; Insureon notes contractors can often be added to the owner’s policy instead of buying their own.
- If you build continuously, ask about a master policy, which Insureon says can cover a stream of projects without a fixed expiration.
- Pay in full: Insureon says insurers usually discount annual payment over monthly installments.
- Put site security, a water damage prevention plan and a hot work fire plan in writing; The Hartford’s application asks for each.
- Lock up copper and high-value finishes and keep materials off the ground; The Hartford asks what is stored in the open or below grade.
- Compare quotes for each project; Florin is an independent broker that compares options from several insurers.
Before you start
What underwriters ask for
- Project address, start date and scheduled completion date
- Construction type, square footage and number of stories
- Hard cost (completed value without land), soft costs and expected rental income
- Owner, general contractor and lender or loss payee
- Site protection: fencing, lighting, alarms, cameras, watch patrols and distance to a hydrant and fire station
- Water damage prevention plan and a fire plan if hot work is involved
- For renovations: year built, existing building value and whether it stays occupied
- If work has started: percent complete and any losses so far
- The insurance section of your construction contract
Common questions
Builder’s risk insurance: questions
Who pays for builder’s risk, the owner or the contractor?
Either can. Insureon says it is usually the contractor, owner or developer, and the standard AIA A201-2017 contract puts it on the owner unless the parties agree otherwise.
Is builder’s risk the same as course of construction insurance?
Yes. Insureon says the two names describe the same coverage, though what each insurer includes can differ.
When does builder’s risk coverage end?
The Hartford says coverage generally ends when the project is completed, the building is occupied or opened for its intended use or the policy term expires. Some forms, such as Travelers’ Construction Pak, offer permission to occupy coverage.
Does builder’s risk cover a remodel?
It can. Insureon says a policy can cover an existing building under renovation, but the existing structure may need to be scheduled or insured separately; The Hartford’s renovation application asks whether you want it insured.
Does builder’s risk cover flood or earthquake?
Not usually without an endorsement, according to Insureon, and Travelers says it depends on where you build. AIA Exhibit A contracts do not let the owner’s policy exclude flood or earthquake.
Is builder’s risk property or inland marine insurance?
IRMI says there is no single standard form and most builder’s risk policies are written on inland marine forms, usually on an all-risks basis.
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Sources (10)
- Insureon: builder’s risk insurance cost (updated July 2, 2026)
- Insureon: builder’s risk insurance (updated May 28, 2026)
- The Hartford: builder’s risk insurance (revised April 2026)
- The Hartford: builder’s risk new construction application
- The Hartford: builder’s risk renovation and addition application
- Travelers: inland marine builders’ risk insurance
- IRMI: builders risk policy definition
- IRMI: Builders risk, new AIA requirements
- AIA Document A201-2017 general conditions (Case Western Reserve University copy)
- Partner ESI: SBA 7(a) construction loan checklist (SOP 50 10 8)
Figures are published third-party estimates, not quotes. Coverage depends on policy terms and underwriting, and rules vary by state. Updated October 2026.