Builder’s risk insurance is a type of property insurance designed to protect a building and certain construction materials from covered damage while construction or major renovation work is underway. During a commercial reroof project, builder’s risk insurance can become especially important because the existing roof may be partially removed or temporarily opened, exposing the building to weather and other construction-related risks.
For building owners, property managers, general contractors, and roofing contractors, understanding how builder’s risk coverage works can help prevent unexpected financial losses during a reroof.
What Does Builder’s Risk Insurance Cover?
Builder’s risk insurance generally covers covered physical damage to the building or construction project while work is in progress. Depending on the policy, coverage may include the existing structure, newly installed roofing materials, equipment, and other construction materials at the project site.
During a reroof, examples of potentially covered events may include fire, certain storms, wind damage, vandalism, or other causes specifically listed or covered under the policy.
Coverage varies significantly between policies. Some builder’s risk policies may also provide coverage for materials temporarily stored away from the jobsite or during transportation, while others may require separate endorsements.
It is important not to assume that every type of roof damage or construction loss is automatically covered.
Why Is Builder’s Risk Important During Reroofing?
A reroofing project can temporarily change the building’s normal protection from weather. Sections of an existing roof may be removed, insulation may be exposed, and new roofing materials may not yet be fully installed.
If a severe storm damages the partially completed roof and causes water intrusion, the resulting loss could involve roofing materials, insulation, interior finishes, equipment, inventory, or other property.
Builder’s risk insurance can provide financial protection against covered losses during this construction period. Without appropriate coverage, the owner or another party could potentially face significant costs depending on the circumstances, contracts, and applicable insurance policies.
Who Typically Purchases Builder’s Risk Insurance?
The party responsible for obtaining builder’s risk insurance depends on the construction contract. The building owner, general contractor, or developer may purchase the policy, while the roofing contractor typically maintains its own commercial general liability and workers’ compensation insurance.
A roofing contractor’s liability policy is not the same thing as builder’s risk insurance. Liability insurance generally addresses certain claims alleging bodily injury or property damage for which the contractor is legally responsible. Builder’s risk is primarily intended to protect the construction project itself against covered property losses.
Before work begins, the parties should review the contract and insurance requirements to determine who is responsible for obtaining and maintaining builder’s risk coverage.
Does Builder’s Risk Cover the Existing Roof?
This is an important question during reroofing. Coverage for an existing structure or existing building components depends on the specific builder’s risk policy and endorsements.
Some policies may provide coverage for existing structures or property being renovated, while others may exclude or limit certain existing-property losses. Owners should not assume that the entire existing roof is automatically covered simply because builder’s risk insurance is in place.
The policy should be reviewed with the insurance broker or qualified insurance professional before roofing work starts.
What About Weather Damage During a Reroof?
Weather exposure is one of the major concerns during reroofing. Roofing contractors normally use temporary protection, sequencing, and daily weather planning to reduce the chance of water intrusion.
However, construction insurance and roofing procedures serve different purposes. Builder’s risk insurance may respond to certain covered weather-related losses, but coverage depends on the policy language, exclusions, deductibles, conditions, and circumstances of the loss.
For this reason, property owners should confirm coverage before removing existing roofing materials.
What Should Owners Confirm Before Reroofing?
Before a commercial reroof begins, the owner should confirm:
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Who is responsible for purchasing builder’s risk insurance.
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What property the policy covers.
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Whether the existing structure and roof are covered.
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Whether roofing materials are covered while stored onsite.
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What weather-related losses are covered or excluded.
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The policy limits and deductible.
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When coverage begins and ends.
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Whether the general contractor and other required parties are properly identified.
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Whether the policy contains exclusions that could affect the reroof project.
The contract, builder’s risk policy, and contractor insurance certificates should be reviewed together rather than separately.
Final Takeaway
Builder’s risk insurance can provide important financial protection during a commercial reroof project by covering certain physical losses to the construction project and materials while work is underway. However, it does not replace a roofing contractor’s liability insurance, and coverage for an existing roof, weather exposure, temporary protection, materials, and other property depends on the specific policy.
Before starting a reroof, building owners should confirm insurance responsibilities and coverage with their contractor, insurance broker, and other project professionals. Coordinating insurance coverage with proper roofing procedures can help reduce financial surprises if unexpected damage occurs during construction.
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