North Carolina General Contractors Test 2025 – 400 Free Practice Questions to Pass the Exam

Builder’s risk insurance is specifically tailored to protect against damages that may occur during the course of a construction project. This type of insurance typically covers risks associated with fire, theft, vandalism, and certain weather-related events that might cause damage to structures being built or renovated. By providing coverage for these unforeseen circumstances, builder’s risk insurance helps to ensure that the financial investment in the construction project is safeguarded against potential losses.

While other options address different aspects of a construction project, such as legal claims, mismanagement, and project delays, those scenarios fall outside the primary purpose of builder’s risk insurance. The insurance is not designed to cover legal liabilities for worker injuries or claims, nor does it provide protection against cost overruns or project delays, which are generally considered business risks not covered by this specific kind of policy. The focus of builder’s risk insurance is clearly on the material and structural damages during the construction phase.