6 Course Of Construction Insurance Questions, Answered

The 2024 federal budget went big on housing, with some claiming it is the most ambitious housing supply plan any federal government has released in the past fifty years, and for good reason. The estimate is that Canada needs to build 3.5 million homes over ten years (2021-2031) to meet demand. Something that has never been done before in our history.

With the push to build more homes and the subsequent rise in new building starts, now is the time for homebuilders to review their course of construction insurance to ensure they’re set up for success. To help you feel prepared and informed to converse with your broker, we’ve answered the six most common questions our clients have when it comes to course of construction insurance.

FAQs of Course of Construction Insurance

Jump To:

1. What is course of construction insurance?
2. Course of construction insurance vs. builders risk?
3. Is course of construction insurance necessary?
4. What does course of construction insurance cover?
5. What does course of construction insurance cost?
6. Where can you buy course of construction insurance online?
   
   
   

What is Course of Construction Insurance?

Course of construction insurance, also referred to as the abbreviation COC Insurance, is a type of construction insurance builders, developers, and contractors purchase to cover buildings and structures during the construction or renovation process. 

This insurance provides protection in the event of damages or loss caused by fire, vandalism, theft, or natural disasters. Course of construction insurance typically begins when construction starts and ends when the project is completed. COC insurance aims to protect the financial investment in a construction project by covering unexpected damages that occur throughout the construction process.

Course of Construction Insurance Vs. Builders Risk: What’s The Difference?

While on the surface course of construction and builders risk insurance sounds like different types of coverage, the fact is, they’re exactly the same. The terminology course of construction insurance and builders risk insurance are used interchangeably. 

No matter the name used, they both cover damages to a structure that is under construction and protect the financial interests of builders, contractors, or property owners. 

Is Course of Construction Insurance Necessary?

While not legally required by the government in Ontario, Canada, any builder, contractor, or property owner undergoing a construction or renovation project would be wise to carry course of construction insurance. In addition to the financial protection it provides, many construction contracts, lenders, and stakeholders require course of construction insurance.

Despite it not being necessary to carry course of construction insurance by law, having this protection is highly recommended for anyone involved in a construction project. By design, it provides financial coverage if an unexpected event occurs that results in financial losses during the construction phase, a critical risk mitigation strategy for any construction business.

What Does Course of Construction Insurance Cover?

A comprehensive course of construction insurance covers a variety of risks that could be experienced during the construction process. Typically, a course of construction insurance covers:

1. Fire: Damages experienced by fires, including structural damages and damage to construction materials on site.
2. Theft: Coverage for financial losses due to theft of materials, equipment, or fixtures on the construction site.
3. Explosion: Coverage for damages caused by an explosion on the construction site.
4. Vandalism: Coverage in the event of acts of vandalism, such as graffiti or destruction on the construction site.
5. Water Damage: Protection from water damage caused by bust pipes, leaks, sewer backup, or other plumbing issues during construction.
6. Natural Disasters: Damages from hail, lightning, wind, earthquakes, floods, and tornadoes are typically covered under a comprehensive course of construction policy.
7. Construction Equipment: Coverage for equipment damaged or lost on the construction site.
8. Temporary Structures: Coverage for temporary structures, such as scaffolding or fencing on the construction site.
9. Soft Costs: Coverage for additional expenses due to delays
10. Extra Expenses: Financial reimbursement for expenses incurred to expedite repairs or mitigate further damage after a covered loss
    
    

What Does Course of Construction Insurance Cost?

Like any insurance coverage, the cost can vary depending on several factors, and course of construction insurance is no different. Typically, when an insurance provider provides a quote, they will take into consideration the following:

1. The value of the construction project
2. The type of construction project
3. The location of the project
4. The duration of the project
5. The risk factors such as past claims and nearby hazards
6. The policy coverage limits and deductibles
7. The general market conditions and risk assessment

Working with an experienced insurance broker, like the ones at Buildsure, who specialize in construction insurance, can make all the difference in your course of construction insurance costs. They will assess the unique risks associated with the project, source multiple quotes from their network of top insurers, and provide their insights and advice on each quote, helping you make an informed decision on your course of construction insurance purchase.

Where Can You Buy Course of Construction Insurance Online?

You can buy course of construction insurance online by filling out an online form to get in touch with the team at Buildsure. Your project is unique and should be your tailored course of construction policy. An experienced construction insurance broker will reach out to learn about your project and, through their relationships with insurance companies, source multiple quotes for your project.  The process is simple, and there is no obligation to buy.

Get All Your Course of Construction Insurance Questions Answered

If you’re still left with questions about course of construction insurance, the insurance brokers at Buildsure are here to help. They’re experienced and knowledgeable in course of construction insurance and can tailor a policy specifically for your project, saving you money while maintaining coverage.