If you have commercial property coverage, you might think that your business property is protected, no matter what situations occur on the premises. Technically, this is true, but under certain circumstances, you may want to beef up the protection you have on your property while it is exposed to greater than normal risks. Builders risk insurance is a great way to get some additional protection for your property as it is renovated and has additions built in order to facilitate or accommodate business expansion.
The Added Risk of Construction
If you need to add another section to your building, then you are going to be under construction for quite a while. High winds, fires, storms, theft and vandalism are all possible problems that your new addition could face while it’s in the throes of development. Builders risk insurance covers your construction area from the date construction begins on the lowest basement floor (or on the structure if there is no basement) and protects the property for 1 year. In addition to protecting the new construction, it also covers the foundation, equipment and supplies used during construction as long as they are within 100 feet of the structure.
What Isn’t Covered
Like any insurance policy, builders risk has certain uncovered items. Any damage to the land, trees, shrubs or plants outside the new or renovated section is not covered. In addition, many outside properties are uncovered, such as signs and antennae. Signs that are actually attached to the building are covered.
Payments for damages that result in claims to your builders risk insurance are paid out as actual cash value, up to the limits of the policy and their relation to the actual value of the building at completion. So, if your limit is 50 percent of the value of your building, your claim will be reduced by 50 percent and the deductible will also be taken into consideration. In addition, claims may only be put through the builders risk policy, not through both builders risk and commercial property coverage.
Business expansion is vital to creating a thriving economy and a thriving portfolio for business owners. When construction is a necessary step in the business expansion, then the purchase of builders risk insurance makes as much fiscal sense as the expansion itself.
Contact us today to make sure your Dallas Business Insurance is right for you and your company!