Wondering what builder’s insurance is and why you need it? Look no further!
So, you’ve applied for a hard money loan for your fix-and-flip or new build and been approved. You’re ready to get started on your project, but you know you need insurance coverage. But what kind of insurance do you need and what does it need to cover?
When it comes to insurance for a building or flipping project, it’s important to get the right coverage.
That’s where builder’s insurance comes in.
There are many names for builder’s insurance. Sometimes it’s called hazard insurance, builder’s risk insurance, or course of construction insurance.
While it’s known by many different names, it basically boils down to one thing — it protects the property you’re building, from the ground up.
It’s important to make sure the builder’s insurance you’re taking out covers exactly what you need: building, liability, equipment breakdown, etc.
For flips and new builds, this means the house, garage, fences, pools, additions, and more are covered. Basically, anything you are building or updating on the property should be covered.
You’ll also want to make sure you have liability insurance to protect you in the case of bodily or personal injury, property damage or injury to others.
You can also choose to get coverage to protect against damage to the property due to mechanical equipment issues, as well as ordinance and law coverage that covers any increased cost due to municipal laws or ordinances.
If you have any questions about what your builder’s insurance must cover, make sure you reach out to your hard money lender or broker.
It’s important to take care of both the property and the people working on it!
Feel free to reach out to us with any questions about hard money loans, the process of getting funded with a loan, builder’s insurance, or anything else!
We’re here to help!