Residential Builders Risk

Advantages of the Unsold Dwelling Policy

New construction sales in the residential housing market have slowed across the country.  Many residential home builders have more unsold dwellings in inventory that ever before. This can create a builders risk problem.  Depending on the insurance carrier, the builder may either not be able to report the unsold dwelling again on his monthly or annual reports if the dwelling has been in inventory for three years or the rate for the third year increases.

The solution for many builders is the Residential Builders Risk Unsold Dwelling policy.  One of the major advantages to the Unsold Dwelling Policy is that it can be canceled mid-term and part of the premium will be refunded.  Since most of these policies have a minimum earned premium, be sure and check with your insurance agent. The coverages provided under the Builders Risk reporting policy are also provided on the Unsold Dwelling policy.

My advice is to discuss your Builders Risk options with your insurance agent if you have unsold dwellings BEFORE you pay your third year premium to determine which option is best for you.