Enhanced Builders' Risk Policies Respond to Changing Exposures and Rising Costs
WARREN, NJ, July 17, 2006 - The Chubb Group of Insurance Companies has enhanced its builders' risk policies to respond to the evolving risks and rising
costs of commercial and residential construction.
The new policies, Commercial Builders' Risk Insurance and Residential Builders' Risk Insurance, include more than 40 enhancements to help protect contractors from a variety of exposures. Some of the key enhancements
are:
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The design exclusion does not apply to contract or construction works that are free of error, omission or deficiency, but
damaged as a result.
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The policy permits up to 45 days of building occupancy before coverage automatically ends for the project.
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Loss or damage caused by or resulting from abrupt and accidental breakdown of mechanical or electrical system or apparatus
is not excluded.
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The residential policy can be extended to include model homes.
In addition, the policies now include automatic limits for several risks that previously had to be added through endorsements,
including soft costs, lost rental income and effects of law. Essentially, this adds an extra layer of protection for building
contractors who are being pinched by rising construction costs.
"Building contractors are financially responsible for every project they undertake. With construction costs rising faster
than the inflation rate, it's more important than ever for builders to have an insurance policy that helps to protect their
livelihood," said Pat Stoik, vice president of Chubb & Son and Global Commercial Inland Marine Manager for Chubb Commercial
Insurance. "Any unforeseen delay or the theft of materials or equipment can have a serious impact on their bottom line."
Cost for materials, labor and fuel continue to rise this year, according to the National Association of Home Builders. Worldwide
demand for cement is high, and rising energy costs will raise prices for roofing and drywall products, which require significant
amounts of energy to manufacture. Rising prices for building materials coincides with rising borrowing costs, as many construction
loans are linked to prime rates, which have risen more than 3 percentage points in the past two years.
Chubb's Builders' Risk insurance can be written for individual construction projects that require a separate policy or it
can be designed to help protect all projects initiated by a contractor during the policy period.
Builders' Risk policies for individual projects are accessible to agents and brokers online through Chubb's @chubb secure
Internet platform, where they can submit an application, obtain a quote and, subject to system approval, bind insurance. For
more information, visit www.chubb.com/agents/chubb2017.html.
"These enhancements, coupled with Chubb's Contractors' Equipment policy, offer builders a construction portfolio that will
give them peace of mind and allow them to focus on the job at hand-building homes and commercial properties," Stoik said.
The member insurers of the Chubb Group of Insurance Companies form a multi-billion dollar organization providing property
and casualty insurance for personal and commercial customers worldwide through 8,000 independent agents and brokers. Chubb's
global network includes branches and affiliates in North America, Europe, Latin America, Asia and Australia.
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