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The cost of almost everything has been rising for the last few years. Whether in your personal life or in running a construction business, expenses are increasing with little control over changing them. While construction insurance may, on the surface, feel no different, there are ways builders can decrease their construction insurance costs in 2024.
Obviously, all builders need insurance. However, not all insurance programs are the same, and the one you choose can make all the difference in your expenses and risk coverage. In this article, we help you take back control as we explore how builders can reduce their construction insurance costs.
5 Ways To Decrease Construction Insurance Costs:
- Get expert advice on construction insurance
- Stay on top of your policy
- Request multiple construction insurance quotes and options
- Tailor your builders risk insurance to your business
- Review your current deductibles
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Get Expert Advice on Construction Insurance
Who you decide to be your insurance broker can make or break how well your business is covered and the amount paid for construction insurance premiums. Selecting a broker specializing in construction insurance will set you up for success. They understand the different insurance products available for construction companies and can make informed recommendations for what you need and, more importantly, what you don’t.
In addition, an expert construction insurance broker will have significantly better volume rates and relationships with insurers than a traditional general broker.
By partnering with the right insurance broker, you can see your construction insurance costs decrease. More often than not, when we conduct an audit of a new prospective client with an existing generic program that hasn’t been reviewed regularly, we see an average premium savings of 30-50%.
Stay on Top of Your Policy
Your business is changing, and so should your insurance policy. That’s why you should review your policy with your insurance broker at least annually. It’s important that your broker knows your current and future projects so they can recommend and make necessary changes to your policy, which could result in substantial savings or mitigate any risks that may not be currently covered.
When your insurance broker is equipped with the latest information on your business, they can position your account with the insurer, giving you a better rate, with the anticipated volume being accounted for rather than charging the full rate for all adjustments.
Request Multiple Construction Insurance Quotes and Options
Proactively, your broker should provide you with multiple insurance quotes and options for your construction insurance policy. When your broker specializes in construction insurance, they will know the best insurance companies to go to who will have the quotes that meet your needs and budget.
Your insurance broker’s role is to act as a guide toward your ultimate decision, answering your questions, helping you weigh the pros and cons of each quote, and involving you in the process every step of the way.
If your current broker provides only one quote or option, does not involve you in the process, or makes the decision for you, it may be time to seek out a new insurance broker. Doing so could decrease your construction insurance expense, provide better coverage, and allow you to be informed of all your options so you can feel more comfortable with your decision.
Tailor Your Builders Risk Insurance to Your Business
One of the largest discrepancies we see every day at Buildsure is the cost of builders risk insurance, sometimes also called a course of construction policy. Most builders have been led to believe that the only option for builders risk insurance is a blanket policy, as it is easy and straightforward for an insurance broker to provide. However, this isn’t the case. There is a better way to save a significant amount of premium with the same coverage.
An experienced construction insurance broker, like the team at Buildsure, understands there are many ways to break down a builders risk policy, decreasing the cost of construction insurance for their clients.
An example of how to decrease construction insurance costs is based on a recent audit we conducted for a new Buildsure client who has various construction projects throughout southwestern Ontario. In the case of this contractor, they were on a blanket builders risk policy, paying $72,000 average cost per year for a $12,000,000 frame detached housing project. Through our expertise, we wrote this project on a site-specific blanket policy for a total premium of $26,400—significant savings for the same coverage, by selecting the right construction insurance broker.
Review Your Deductibles
One of the simplest ways to decrease the cost of your construction insurance policy is to review your deductibles. If you are comfortable increasing your deductibles, for example, from $1,000 to $2,500 or $5,000, you can see up to a 20% additional discount on your premiums. Meeting with your insurance broker to review your deductibles is a quick and easy win on the way to reducing your overall construction insurance costs.
Next Steps: Talk to the Construction Insurance Experts
As seen throughout this article, your construction insurance broker is the linchpin to reducing your construction insurance costs this year. Connecting with a Buildsure insurance broker, an expert in construction insurance, is the best next step to gaining control over your construction insurance expenses. They will audit your current policy, provide recommendations, source construction insurance quotes, and ensure you receive the best value for your company’s insurance needs.
