What Does California Contractor’s Insurance Cover?


A construction insurance policy protects clients against unpredictable loads on the building, which can be caused by manufacturing or construction errors. Included in the cost of contractor insurance California, is coverage for third-party bodily injury and property damage.¬† ¬†Coverage limits are disclosed on your policy’s declarations page.

Certain policies may include additional coverage for weather events such as storms and floods as well as natural disasters such as earthquakes. Inevitable forces are riots and wars.

These damage events cover a policy.

design flaw
material defects
Theft of permanently installed material

Attention: Excluded from the regulation are damages caused by lightning, fire or explosion. For the duration of the construction activity, a separate fire endowment insurance is recommended here.

What are the other limitations of construction insurance?

Legislators and insurance companies draw fine lines when it comes to the nature of weather events. This differentiates between unusual and extraordinary weather conditions.

In exceptional weather, the law obliges construction insurance to reimburse the costs of damage events of such magnitude. If the weather is just unusual, this is not necessary from a legal point of view. Insurers, therefore, do not anchor it in their general conditions of insurance.

Unusual weather conditions include permafrost in winter or heavy wind and heavy rain in autumn. Exceptional weather conditions go well beyond.

These restrictions exist : Restrictions on theft protection

When it comes to theft on a construction site, the construction insurance only covers the cost of theft of components already installed. This can be about an already established radiator. If the construction site steals such an aggregate while it is still waiting for its installation, the performance is excluded.

Restrictions on the consequences of insolvency

If a construction project is delayed or is not completed because one of the contracted construction companies goes bankrupt, the insurance does not cover the consequential costs.

When will construction insurance be finalized?
The best time to complete a policy to protect construction is the time before the actual start of construction. Because only then all components, materials and construction work for the new, rebuilding or dismantling are protected against damage.

What are the costs of construction insurance?

As with every insurance business, the cost of construction services insurance is also determined by the service catalog. Apart from the requirements prescribed by law, the companies decide which services they want to include in the special tariff. So you are free to include or exclude certain events of the claims in the catalog.

The more comprehensive the catalog of benefits and protection, the higher the cost of a policy.


Cost-intensive construction projects should be well protected. Severe and uninsured damage when building a house can be a financial disaster. Under certain circumstances, it not only endangers the construction project itself but can destroy the economic existence of the builder.

What are the premiums for construction insurance, also depends on the cost of the construction project, the construction cost. The construction cost includes all construction costs: from the first ground-breaking to completion. Not included in the construction cost is the price of the property, as well as the costs of development, power supply and connection to the sewerage system.
Important: When determining the construction costs, builders must under no circumstances forget their planned own work.

How long is the construction insurance?

The term of a policy is in most cases a maximum 1 year. However, it may also end before the expiry of the maximum period prescribed by law. This is the case, for example, if the house has already been built ready for occupancy, the building authority has taken over the construction or six working days have elapsed since the beginning of its use. Decisive for the end of the term is the earliest date. The appointment must inform builders of their insurer.