Other Insurance in Texas
There are always big buildings and construction projects happening in Texas. From highways and interstates to skyscrapers and homes. These building projects often require specific builders risk insurance and/or bonds. Allen Jones Insurance Agency in Canyon Lake, TX wants you to understand the potential value of both for your next building project in Texas.
What is Builders Risk Insurance?
Unlike homes, bridges, and buildings that have established values, the value of these projects, during the construction stage, is fluid. If a covered event occurs, the value of the project will depend on the stage of construction. Covered risks include a variety of risks, such as:
- Fire
- Tornadoes
- Lightning
- Hail
- Explosions
- Vandalism
- Damage from vehicles
In some instances, damage from hurricanes may be covered, though you will need to check with your individual insurer for details and additional protection you may need to purchase. The bottom line is that Texas has plenty of weather events and other risks to consider making this a worthwhile investment for most construction projects.
Builders risk insurance covers the project at various stages for the value at those stages. You can opt for insurance that covers the structure that is complete or the structure and building materials that are on-site. These policies are usually written in three, six, and twelve-month terms though they may be extended if necessary (but usually extensions are only available one time).
What are Construction Bonds?
Many Texas homeowners or investors will ask for construction bonds during the construction of their homes or business properties. These bonds protect them from losses that may occur if you are unable to complete the project within an agreed-upon timeframe or according to project specifications. There are three different and primary types of construction bonds in Texas:
- 1. Bid bonds. Protects the person who owns the project should you back out after winning the bid.
- 2. Performance bonds. Replaces the bid bond once the contract moves forward and work begins on the project.
- 3. Payment bonds. Guarantees the winning bidder has financial means to pay subcontractors, materials suppliers, and workers for the project.
Allen Jones Insurance Agency understands the confusion some contractors may experience with various bonds and builders risk insurance protection. Contact us today to learn more about your options in Canyon Lake, TX and surrounding communities for your insurance coverage needs.
