Builder’s Risk Insurance
Many construction companies and property owners purchase builder’s risk insurance if they’re building an infrastructure. Builder’s risk is a first-party insurance designed to protect the policyholder from risks they may face during construction, repair or renovation of a structure. It generally covers the material, supplies, equipment onsite and the property itself if it undergoes an unforeseen peril such as a hurricane or fire. The purpose of builder’s risk is to provide coverage in case any incidents damage the property. However, insurance companies may deny viable claims because they wish to make as much money as they can off of their policyholders. This means they are acting in bad faith and can be held liable for their deceptive actions. If you believe your insurer is acting in bad faith, then it’s imperative you contact an experienced attorney in insurance law.Attorney for Builder’s Risk Claims in Texas
Construction contracts and insurance policies are the backbone of successful development projects. Unfortunately, your insurance company may put a hold on your progress if they refuse your viable claim. Rejecting a valid claim is a bad faith action, meaning your insurance company can be held legally responsible for their actions. You deserve to have coverage and the attorneys at LeMaster Law Firm want to help you receive it. We actively represent property owners, architects, engineers, general contractors, subcontractors, suppliers and anyone having issues with their builder’s risk coverage. We are well-equipped to address not only the complexity of these cases, but also the unique concerns and issues that may arise when representing construction companies or property owners. Pick up the phone to call us now at 832-356-7983. With our extensive experience in construction and property insurance litigation, we can provide excellent legal representation for you. LeMaster Law Firm represents people throughout Texas from The Woodlands and Laredo. We represent policyholders throughout the greater Houston area including: Montgomery County, Harris County, Galveston County, and Webb County.Overview of Builder’s Risk Claims in TX
- What Does Builder’s Risk Cover in Texas?
- Why Was My Builder’s Risk Claim Denied?
- Challenging a Denied Claim in Texas
- Additional Resources
What Does Builder’s Risk Cover in Texas?
Builder’s risk is a type of coverage for policyholders who face risks while constructing, repairing or renovating a building or infrastructure. It is designed to protect you as the policyholder from unforeseen perils such as fires, wind damage or theft and vandalism. Additionally, builder’s risk can provide protection for delays, loss of market, faulty workmanship, and other indirect consequential losses. Not all builder’s risk policies are the same, but most tend to be written on an “all-risk” basis. In other words, it will cover all causes of loss except for those specifically excluded from the policy. A typical builder’s risk policy covers the following:- Fire damage;
- Specific types of water damage;
- Lightning;
- Hail;
- Unforeseen explosions;
- Theft or vandalism;
- Materials, supplies and equipment onsite; and
- Vehicles or aircraft crashing into the structure
- Real estate taxes;
- Architect fees;
- Bond and permit fees;
- Legal and accounting fees;
- Interest;
- Extended general conditions costs such as portable toilets and water; and
- Lost sales or rental income
Why Was My Builder’s Risk Claim Denied?
Insurance companies reserve the right to deny coverage that is outside of your policy. However, some insurers reject perfectly valid claims so they can profit from your account. Deceptive insurance companies may utilize various tactics to convince you their denial is within their rights as an insurance company. A common strategy used is to state that the claim you filed is excluded from your policy. Exclusions are losses that aren’t listed in your insurance policy. Your insurance many declare that your damages are excluded from the policy so they cannot provide coverage. They may use confusing verbiage and intentionally misinterpret your claim so they can reject it entirely. However, builder’s risk insurance does have exclusions depending on the policy. These can include wear and tear, war damages, flood damage, earthquakes or design errors. In some cases, your insurance may state that the damages already existed before you experienced any unforeseen peril. They could claim you weren’t aware that the damage was pre-existing or they may suspect you of insurance fraud. For example, imagine you have builder’s insurance for a new hotel you and your construction team are renovating. Suppose a storm occurred and there was significant water damage. Your insurance may state that the warped floors from the water damage already existed, so they cannot provide coverage.Challenging a Denied Builder’s Risk Claim in Texas
Your claim may have been denied, but you don’t have to give up on pursuing coverage. If you believe your insurance acted deceptively, then you may be eligible to file a bad faith claim. An insurance company acts in bad faith when they intentionally fail to uphold their implied and expressed duty as an insurer. You may be able to file a claim against your insurance company and receive compensation for any losses you experienced since the denial. It’s highly recommended you hire effective legal counsel if you wish to file a bad faith claim. Insurance law is incredibly intricate, and you will need extensive resources to go up against a large insurance company. Most insurers already have legal teams on standby, so it’s incredibly important you’re prepared for what’s next. If you win your case, the court will grant you a monetary award. The compensation will reflect any and all losses you suffered because of your insurer’s actions. These may include:- Repairs;
- Loss of income;
- Lost wages;
- Attorney’s fees;
- Interest;
- Costs from extending construction;
- Construction delay-related costs; and
- Mental anguish
