Three Pronged Test for Valuing Builders Risk Form
Arriving at an adequate amount of insurance for a Builders Risk Form is a three pronged test including: (1) review of the building specifications and costs; (2) review of the contractual requirements; (3) monitoring the work in process and increasing coverage as necessary. Understanding the coverage form, be it Completed Value or Provisional Reporting, is key to the process.
Did You Know: Many construction requirements require insurance be written in the amount of the “initial contract” sum and all “subsequent modifications” thereto.
Did You Know: That most Builders Risk forms are written on a Completed Value Form which then would require that there are interim adjustments made to the policy to cover all “change orders.”
Laurie Infantino, AFIS, CISC, CIC, CRIS, ACSR, CISR
Insurance Skills Center
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