Church Construction Insurance Coverage: Builders Risk Insurance For Religious Organizations
When a church is planning significant renovations, it will be essential to purchase a church construction insurance policy aka builders risk insurance policy.
As your church insurance brokers, we want nothing more than for our church clients to continue to grow.
We have helped find the right church insurance program for these churches that only had ten or more church members
Seeing these same churches grow to over a thousand members is incredible. As they grew, so did their church insurance coverage needs.
No matter the size of the project, when you are adding additional square footage to your church, or building a brand new church auditorium you will need to obtain a special insurance policy.
What is A Church Construction Insurance Policy
A church construction insurance policy is called a course of construction insurance or a builders risk policy. As the two names state, this policy provides insurance coverage throughout the building process.
Often the general contractor includes this policy as part of their bid for the project. However, many times this responsibility will fall onto the church.
- Acts of God, like hurricanes
How Much Do Church Construction Insurance Policies Cost?
A church construction project insurance policy can cost a few thousand dollars to tens of thousands of dollars.
The total cost is based on multiple factors, including:
- The total cost of construction (soft cost and hard cost)
- Experience as a general contractor building a similar project
- Past insurance claims history of the general contractor
- Length of the construction project
- Security around the project
- The max value of construction materials stored at the job site or offsite storage area.
- Deductible chosen
- Optional coverages added to the policy
What Doesn't A Church Construction Insurance Policy Cover?
A builders risk insurance policy typically excludes:
- Contractor’s tools left on the job site
- Flawed Workmanship
- Floods/Water Damage
- Acts of War or Government Action
- Intentional Acts
- Employee Theft
- Contractual Penalties
- Mechanical Breakdown
It is essential to understand and read your entire policy fully. There is no standard policy form related to a builder’s risk policy. Depending on your overall church’s budget related to insurance costs, it may be tempting to remove coverages from your church construction project insurance policy to save a few bucks.
Most builders’ risk policies include coverage for ‘Acts of God such as extreme weather. However, your insurance policy may stipulate specific requirements in order for coverage to be available. One example could be, to provide reasonable protection of your off-site stored building materials from the elements.
Collect Certificate Of Insurance From All Contractors
As a church, your General Contractor must list your organization as an Additional Insured on their liability policy.
In addition, you will want their workers’ compensation insurance to provide a waiver of subrogation in your favor.
You must require each subcontractor also have the exact insurance requirements and provide you with proof of their insurance.
Any subcontractor who fails to meet your insurance requirements must be denied access to your church’s construction project.
Most church construction project insurance companies will require you to make this a requirement for purchasing their insurance coverage.
A church can be liable for all injuries if it fails to enforce these requirements.
In addition, the church insurance company will charge a hefty premium due to the payroll related to the uninsured contractors.
When Do Churches Add The New Building To Their Existing Insurance Program?
When the church’s construction project is completed, it is essential to contact your church insurance agent and request for them to add the additional square footage or new building to your policy.
Countless churches forget to notify their Agent once the project is completed.
Your construction project is completed once your city inspector provides their final signature. With this signature, the city agrees that the project was built to code and current standards.
While many people love to hate the city inspector, they are there to protect the building owners from faulty work products.
Will Our Current Church Property Insurance Policy Coverage Our New Construction Project?
No, your current church property insurance policy does not cover new construction. It covers the existing church buildings only.
If your church is building a new facility, or adding on to your existing church property you must purchase a separate policy for the project.
If your church is doing basic updates such as painting the interior or exterior church building, your current small church insurance program will provide the needed protection.
Please contact Integrity Now Insurance Brokers to discuss the project details and to find out what kind of insurance for churches is needed for your new construction projects.
Our experienced church insurance agents can help guide you in making sure the right coverage is purchased and provide options to fit your budget.
Looking For A Church Construction Insurance Agent
Integrity Now Insurance Brokers is here to help you with your next construction project.
It is essential not to skimp on your builder’s risk insurance policy. Purchasing all of the available critical coverages helps provide the protection your church will need in the event of a total loss.
We have seen projects get to 99% completed, and a fire starts, and all is lost.
Thankfully, churches with the correct church property insurance could rebuild without suffering a significant financial loss.
Our church insurance providers are A-rated by AM Best and are in good financial standing. Reach out to one of our church insurance specialists and see how we can help you save on your churches insurance.
We can also help you with your general liability, workers’ compensation insurance, directors and officers insurance, employment practice liability insurance, abuse coverage, group health insurance, and more.