What does the term Builders Risk refer to?

The term Builders Risk specifically refers to a special insurance policy that provides coverage for buildings that are currently under construction. This type of coverage is designed to protect against various risks that can occur during the construction process, such as damage to the structure due to fire, vandalism, or weather events. Builders Risk policies can cover the building itself, materials on-site, and sometimes even equipment used in construction.

This form of insurance is crucial for builders and contractors, as it helps to mitigate potential financial losses that could arise from unexpected events during the construction phase. Unlike other types of insurance mentioned, such as homeowners' insurance or liability insurance for contractors, Builders Risk is tailored to address the unique circumstances and exposures that come with construction activities.