Insurance for the custom home build
Building a custom home on your own land introduces risks that a standard homeowners policy is not built to handle. From the moment construction begins, financial exposure extends beyond the structure itself to include materials, theft, vandalism, and liability associated with the job site.
A Homeowners Course of Construction policy is designed specifically for the property owner. It bridges the gap between construction and occupancy, protecting your interest in the structure and materials until the project is complete and ready to transition to permanent coverage.
When coverage is required
The need for course of construction coverage is dictated by land ownership and the construction contract. When you own the lot and hire a general contractor, you are the primary stakeholder and require coverage in your own name.
Coverage is typically required when:
The builder’s insurance protects the builder. This policy protects you.
Course of Construction vs. Builder's Risk
Course of construction insurance and builder’s risk coverage serve different purposes and name different insureds.
Builder’s risk policies are typically purchased by contractors to protect the builder’s interest. A homeowner course of construction policy is issued in the homeowner’s name, making the property owner the Named Insured.
When the homeowner is the Named Insured:
For homeowners building on their own land, relying solely on a builder’s policy leaves critical gaps in liability and control.
Premises Liability and Property Exposure
A construction site creates unique liability exposure. Friends, family, or neighbors often visit to view progress, creating risk that is not covered under a contractor’s professional liability policy.
If a guest is injured on the property during construction, liability rests with the landowner. A course of construction policy attaches premises liability to the land, protecting against claims arising from injuries to visitors.
As construction progresses, materials and appliances may be delivered well before installation. Theft or vandalism of these items typically falls on the property owner. This policy can provide protection for materials stored on site, in transit, or in temporary storage.
