A Builder’s Risk policy provides property only (no liability) coverage for a project while under construction. When determining the correct amount of insurance, consider insuring for the entire construction contract amount which will include soft costs such as plans, permits, builders profit, etc. Loan fees should be also be included. The purpose of including these fees is if a disaster were to happen the day the house was to be completed, all of these costs would need to be paid again in order to correctly cover the cost to rebuild.
