If you’re in construction, you likely carry Builders Risk and Contractors Equipment insurance. But despite both covering “stuff on the jobsite,” these policies are very different—and confusing the two can leave you with costly gaps in coverage.
In this blog, we’ll break down how each policy works, what they cover (and don’t), and how to structure your program so you’re fully protected without overpaying.
What Is Builders Risk Insurance?
Builders Risk covers buildings and materials during the course of construction. Think of it as property insurance for a project before it’s complete.
What it typically covers:
-
Buildings under construction
-
Materials stored on-site (sometimes off-site or in transit)
-
Soft costs (delays, permits, interest)
-
Vandalism, fire, theft, and some weather events
What it doesn’t cover:
-
Tools and equipment
-
Employee theft or dishonesty
-
Liability claims
-
Wear and tear or mechanical failure
📍 Pro Tip: Always check if the materials are covered in transit or temporarily offsite—coverage varies by policy.
What Is Contractors Equipment Insurance?
Contractors Equipment Insurance protects your tools, machinery, and heavy equipment.
What it typically covers:
-
Owned or rented machinery (excavators, cranes, generators, etc.)
-
Small tools (if scheduled or under blanket)
-
Equipment in transit or temporarily off-site
-
Theft, fire, vandalism, and accidental damage
What it doesn’t cover:
-
Buildings or structures
-
Materials for a specific job
-
Routine maintenance or wear and tear
-
Liability or workers’ comp claims
📍 Pro Tip: Not all policies automatically cover rented equipment—you often need a special endorsement or rider.
Why People Confuse Them
Both policies cover physical items on a jobsite, and both can be triggered by events like theft or fire. But here’s the key:
-
Builders Risk covers projects.
-
Contractors Equipment covers gear.
Trying to file a claim for a stolen skid steer under your Builders Risk policy? You’ll likely be denied. And if your project site is vandalized and damages the building structure—but you only have equipment coverage—you’re in trouble.
Common Coverage Gaps to Avoid
1. Unscheduled Equipment
If your policy doesn’t include a blanket limit for unscheduled equipment (like handheld tools), smaller claims may be denied.
2. Equipment Loaned to Subs
Many equipment policies exclude tools loaned to subcontractors. If you share gear on multi-trade sites, this is a critical exposure.
3. Incomplete or Misaligned Builders Risk
If your Builders Risk policy doesn’t match your project timeline, site security conditions, or materials sourcing, you may be underinsured.
4. No Coverage for Rental Reimbursement
If your equipment goes down, can you rent something temporarily and get reimbursed? Only if your policy includes that endorsement.
How We Help Contractors Get It Right
At Innovators Insurance, we routinely conduct:
-
Coverage audits to ensure your Builders Risk and Equipment policies complement each other
-
Project timeline reviews to ensure Builders Risk aligns with actual start and end dates
-
Blanket tool coverage strategies to reduce paperwork and avoid scheduling errors
-
Rental equipment endorsements to minimize project delays
Real-World Example
A GC has Builders Risk and Equipment policies from two carriers. After a fire damaged a partially completed structure and destroyed two rented generators, both carriers initially deny the claim due to unclear coverage responsibilities.
Don’t Let Confusion Cost You Coverage
Builders Risk and Contractors Equipment are both essential—but they only work when structured correctly.
📄 Request a Jobsite Coverage Review
Coverage that’s built right protects your work—and your bottom line. Let’s build smarter together.
