What Are the Types of Construction Insurance?

Builders have a plethora of things to consider when it comes to insuring their business and their buildings. Ensuring they have the right insurance can be daunting. If you own a construction business, read further to see what is the most common kinds of construction insurance you will encounter for residential construction.

General Liability

One of the most common policies in the construction industry is general liability. It covers a general policy of bodily injury and property damage. The one thing it won’t cover is the costs needed to fix any defective work, just the damage caused by it. Of course, you must read the fine print with any policies or ask questions if you don’t understand, since different policies will have their own exclusions and terms and conditions.

Builder’s Risk

These policies are specifically designed for buildings under construction and offer comprehensive protection. This type of construction insurance covers the building, materials, and equipment. They usually include:

  • Theft
  • Vandalism
  • Fire and explosions
  • Weather events, such as lightning, wind, and hail

These perils vary from policy-to-policy, so ensure you get all the information you need. Standard coverage exclusions are common with a builder’s risk policy, as well, which you need to take note of and which includes:

  • Flood damage
  • Earthquakes
  • Employee theft
  • Someone quitting work

You can many times bundle a builder’s risk insurance policy into general liability coverage.

Contractor’s License Insurance

Contractor license bonds allow for your protection and guarantee that the contractor or construction company can fulfill project roles. It’s also designed to protect any business partners, as well as the public from unnecessary risk. Contractor credibility is another reason to have this type of insurance and is offered to contractors to ensure they can be trusted to finish the project.


Worker’s Compensation

A construction company that offers worker’s compensation is essential, mainly because of the hazards associated with working on-site. Having coverage protects against possible injuries and needing to pay out-of-pocket expenses. The coverage includes:

  • Medical expenses
  • Legal fees in case of a suit
  • Missed wages to the injured party

Not only is it beneficial to have worker’s comp, but it’s also required in some states, regardless of the size of your company. Some of the requirements include states having their own insurance providers, so learn about what your state requires, so you’re not unnecessarily putting your company at risk.

Construction Bonds Insurance

Similar to construction bonds, contractor license bonds apply to specific aspects of the construction project. Many different types of construction bonds are available for a particular part of a construction project. For example, a payment bond guarantees that the contractor can provide payment to subordinates and suppliers; this decreases risks while on the project.

Call Post Insurance

If you need help deciding which types of construction insurance to offer, please get in contact with us. We can answer your questions and address any concerns you have while providing excellent service to our customers, including competitive rates and coverage consultation. Give us a call today and let us be your insurance provider.