Buying a newly built home? You may hear both builder’s risk and homeowners’ insurance mentioned during the process. But they’re not the same, and knowing when each applies can prevent major coverage gaps. Check out our guide below!
Questions? Reach out to one of our knowledgeable insurance agents. We’re eager to set you up with the right coverage and rate!
Builder’s Risk Insurance: What It Covers
This is the builder’s responsibility. It typically covers:
- Theft or vandalism during construction
- Damage from fire, wind, or storms
- Materials stored on-site
- Temporary structures like scaffolding
Important: This policy only lasts during construction and only protects the builder’s investment, not your personal property or liability.
Homeowners Insurance: When You Need It
You’ll need to secure your own homeowners’ policy before closing. This covers:
- The structure (dwelling coverage)
- Your belongings (contents)
- Personal liability if someone gets hurt on your property
- Loss of use if you can’t live in your home after a covered event
- Most lenders require a homeowners insurance policy to be active before you get the keys.
Seamlessly Transitioning Coverage
The handoff from builder’s risk to homeowners’ insurance is crucial. To avoid being uninsured:
- Ask your builder when their policy ends
- Coordinate closing and move-in dates with your agent
- Get proof of insurance to your lender at least a week ahead
- Adjust your coverage to match your warranty and upgrades
Cornerstone Insurance Agency LLC, makes it easy to switch from builder to buyer.
We’ll make sure there’s no coverage gap and that you’re protected the second you take ownership.