As with any large project, insurance is required when building a home. Every bank will require that the homeowner have Course of Construction insurance and General Liability insurance. These insurances protect the contractors, the contractor employees, and the construction site.

Course of Construction Insurance
A short-term insurance that protects the homeowner’s building site from fire, vandalism, theft, replacement cost, and much more. Although the builder has liability insurance, it will not cover any damages occurring on your property.

Course of construction insurance varies in coverage. Some will not cover items stolen from an unlocked site. Read the fine print before deciding on what company to take out insurance. Make sure that the insurance will cover everything on your property and building site.

General Liability Insurance
This is insurance carried by the builder of your home and his employees. It is designed to protect them from lawsuits by the homeowner if there is a breach of contract or damage to the property due to an error or mistake.

You should make sure that the builder you hire has General Liability insurance and it is current. If there is any damage caused by an uninsured builder, you will have a hard time getting any money from them.

Worker’s Compensation
This insurance is only good when your builder has his own business and employees. Each employee should be covered in case they are hurt or killed on your building site. It is a good idea to not hire anyone who does not carry worker’s compensation. You can be held responsible if a worker is injured on your site.

The only time a builder is not responsible for worker’s compensation is when he does not have regular employees. In this case, the builder needs to write a letter stating that he does not need worker’s compensation. This will keep you from being held liable for an injured worker.

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