I’m building a new home. Do I need to insure it while it’s under construction? How do I insure it?
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Yes, it is essential to insure your new home during the construction process. Construction sites can be dangerous, and there is always a risk of accidents and damage to the property. Here are the six steps you can take to insure your new home during construction:
- Contact your insurance agent: Your existing insurance agent may be able to help you with a builder’s risk insurance policy. A builder’s risk policy will protect your property during the construction process.
- Consider the policy terms: When selecting a builder’s risk policy, make sure to review the policy terms carefully. The policy should cover damage to the building, theft of building materials, and damage caused by natural disasters, among other things.
- Determine the policy coverage limits: Make sure the policy coverage limits are sufficient to cover the cost of rebuilding your home in the event of a total loss.
- Determine the policy period: Your policy should cover the entire period of the construction process, including the time it takes to build the home, install fixtures, and complete any final touches.
- Coordinate with your contractor: Your contractor should be listed on the policy as an additional insured party. They will be responsible for overseeing the construction process and ensuring that the project is completed in a safe and timely manner.
- Consider additional coverage: Depending on your location and the specific construction site, you may want to consider additional coverage, such as flood insurance or earthquake insurance.
In summary, it is important to insure your new home during the construction process to protect yourself from potential financial loss. Contact your insurance agent to obtain a builder’s risk policy, review the policy terms carefully, and coordinate with your contractor to ensure that your policy is adequate for the specific construction site.
Asked November 29, 2011 by Andy Villena