We recently insured a $2.5 million custom home in Utah.
What made this project interesting wasn’t just the size of the home. The builder actually recommended that the homeowner shop for their own builders risk insurance, the builder knew it could be more affordable than if they obtained coverage.
So the homeowner came to us.
We reviewed the project, compared the coverage with multiple carriers and ultimately placed a 12-month builders risk policy for just under $6,000 through Cincinnati Insurance.
For a $2.5 million custom home, this was a great result, and it’s a good example of why it can be worth looking at your builders risk options before construction begins.
What Is Builders Risk Insurance?
If you’ve never built a home before, builders risk probably isn’t something you’ve spent much time thinking about.
Builders risk is insurance designed to protect a home or building while it’s under construction.
When you’re building a custom home or a commercial building, you can have a significant amount of money tied up in the project long before you ever start. Framing goes up, windows are installed, cabinets and flooring are ordered, and expensive materials are constantly being delivered to the property.
A standard homeowners policy isn’t designed for a home under construction.
Builders risk helps protect the project if something goes wrong during construction, such as a fire, theft, vandalism or certain types of weather damage and covered perils.
It Wasn’t Just About Finding the Lowest Price
Of course, price was important, but we also wanted to make sure the coverage made sense for a custom home of this size.
The policy insured the home for its full $2.5 million completed value and included protection for some of the things that can easily get overlooked during construction, like building materials being transported to the property or temporarily stored somewhere else.
That’s important on a custom build where expensive windows, cabinets, flooring and other materials may be purchased long before they’re actually installed.
Every construction project is a little different, so we like to look at how the home is being built and make sure the policy fits the project, not just find the cheapest builders risk quote.
Should the Homeowner or Builder Carry Builders Risk Insurance?
This is where this particular Utah project gets interesting.
A lot of homeowners assume their builder will automatically handle the builders risk insurance. That’s not always how it works.
Depending on the construction contract, the builder may provide the coverage, or the homeowner may be responsible for purchasing their own policy.
In this case, the builder had decades of experience and was actually the one who suggested that the homeowner shop for their own coverage because they knew it could potentially save them money.
If you’re building a home and your contractor gives you the option to provide your own builders risk insurance, it’s worth getting a quote before automatically having the insurance included in the cost of the build.
Even if your builder has already given you a price for builders risk, there’s nothing wrong with seeing how it compares.
Builders Risk Insurance for Custom Homes in Utah
We’ve found Cincinnati Insurance to be extremely competitive on many of the builders risk projects we’ve worked on, particularly custom homes.
That doesn’t mean Cincinnati will be the right fit or the lowest price for every project. Location, completed value, construction type, length of construction, builder experience and other factors can all affect the cost and availability of coverage.
But if you’re building a custom home in Utah, it’s an option that’s worth looking at.
We can help with builders risk projects throughout the state, including areas like Bear Lake, Park City, Heber City, Midway, St. George, Utah County, Salt Lake County and surrounding areas.
Are You a Utah Home Builder?
We also want to be a resource for local builders.
If you prefer having your clients purchase their own builders risk insurance, we’re happy to work directly with them.
You can send the homeowner our way, and we’ll help gather the information we need, look at the available options and get the builders risk policy in place.
That gives your client an opportunity to shop their insurance while taking one more thing off your plate.
If you regularly build custom homes in Utah, we’d be happy to work with you and your clients whenever a new project comes up.
What Do We Need to Get a Builders Risk Quote?
Getting started is usually pretty simple.
We’ll want to know where the home is being built, the estimated completed value, who the builder is, how long construction is expected to take and some basic information about the home.
If you already have a builders risk quote or your contractor has given you a price for the coverage, you can send that to us as well.
We’ll take a look at the project and see what options we have.
Building a Home in Utah?
If you’re getting ready to build a custom home, it’s worth figuring out the builders risk insurance before construction gets underway.
Our Bear Lake client was building a home with an estimated completed value of $2.5 million, and we were able to place a 12-month builders risk policy for just under $6,000.
Every project is different, and your pricing will depend on the details of your build. But this is a good example of why it’s worth getting a builders risk quote instead of assuming the option presented by your builder is the only one available.
Building a home in Utah? Contact Anderson Insurance Group and we’d be happy to take a look at your project and see what builders risk options are available.
Get a Builders Risk Quote
Send us some basic information about your project and we’ll help you get started.
Name
Phone Number
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Project Address
Estimated Completed Value
Builder / General Contractor
Expected Construction Start Date
Has construction already started?
Additional Project Details