Professional liability insurance is essential in the construction industry because the work done has the potential to affect lives for years to come. The potential damages could be a devastating risk to take without insurance. It’s not surprising, then, that many newer business owners mistake it and risk coverage, which is also essential.
Risk insurance is not the same as liability coverage, though. Where liability insurance covers damages to other parties that you would be liable for, builder’s risk protects your business.
Common Coverage Options
Risk policies protect your interest in the event a jobsite is vandalized or damaged while you are working. It covers equipment and tools on site, supplies, and even administrative trailers. Typical provisions include fire, lightning strike, and theft as well.
There are also exclusions to the risk policy, and they are mostly there because there are specific forms of insurance to cover those events as needed. Earthquakes and floods are two examples.
Protect Your Business
Liability insurance is about making sure you have the financial resources to do right by other parties if your workmanship or employees’ work winds up having faults. Builders risk insurance coverage is to protect you and your equipment, supplies, and other onsite assets. Make sure you carry enough of both to round out your company’s risk management plan.