What types of construction insurance do you need?

March 3, 2024

Canadian construction industries play a vital role in our nation's economic landscape, from residential renovations and large infrastructure projects to renovations of individual residences. But What types of construction insurance do you need? However, each project comes with inherent risks that pose potential financial liabilities to those involved; that is where Construction and Realty Insurance Canada and SummitCover come in - providing comprehensive insurance solutions designed specifically to cover Canadian projects in construction.

Navigating all the various insurance options can be complex; but, this blog post attempts to simplify it by outlining essential coverages needed for any project:

Builder's Risk Insurance: Guarantee a Cushion for Construction Investments against Unexpected Financial Losses

This type of insurance fills up all the policy plans of the project during construction. It protects against physical damages caused by events like 

  • Fire and lightning
  • theft and vandalism
  • windstorm and hail damages
  • water damages as well as explosion

Scope of Coverage

  • This policy typically provides coverage for structures and raw materials stored both onsite and during transit
  • It also includes buildings as a whole and any materials, fixtures, or equipment necessary during their construction.
  • It encompasses tools and machinery used for construction activities. 
  • Debris removal costs are also covered by it. 

Benefits Of Builder's Risk Coverage

Construction project insurance gives your investment financial protection by covering repair or rebuild costs caused by covered perils, giving peace of mind during construction projects without worrying about unforeseen financial losses. Many construction contracts mandate builders to acquire this policy to protect both parties involved financially.

Builder's Risk Insurance Is Essential

This policy should be included as part of every construction project regardless of size or complexity, from when materials arrive on-site until completion and handover. 

Additionally Considerations

  • Valuation: An accurate valuation is critical to provide adequate protection. 
  • Exclusions: Review any policy language to understand any exclusions that might apply. 
  • Named perils vs all-risks coverage options: Choose an insurance plan that covers only those risks that pertain specifically to your project.

Construction Liability Insurance: Coverage, Benefits, and Considerations

This coverage protects you against financial repercussions associated with third-party claims for bodily injuries or property damages that have resulted from your construction activities, which include:

  • Bodily Injury Coverage: This may include medical costs and lost wages in case someone on your site, including workers, visitors, or passersby is injured due to construction activities.
  • Property Damage Coverage: You should consider covering costs related to damage done to third-party properties due to construction activities being done there as well as benefits. 


Construction liability insurance provides invaluable protection to protect assets and boost client confidence in your business. By showing proof that you possess liability coverage, construction firms can instill trust among clients who see they possess this protection and feel more assured doing business with them. Many municipalities and construction contracts mandate contractors carry such policies to comply with regulations. 

Who Needs Construction Liability Insurance? 

Any entity engaged in construction activities including: 

  • general contractors
  • Subcontractors
  • material suppliers 
  • architects 
  • Engineers

Additional Considerations

  • Limits of Coverage: Make your coverage choices according to the project size and risks involved, taking into consideration any contractual liability requirements as part of any decision process.
  • Additional Coverages: Consider including endorsements to cover certain risks such as pollution or professional liability.

Essential Coverages for Comprehensive Construction Insurance Plans

Builder's risk (COC) insurance and construction liability coverages will provide the foundation of any comprehensive construction insurance plan; however, further coverages may be necessary based on specific project needs - here are a few examples:

  • Workers' Compensation Insurance: Required by most provinces and providing medical expenses and lost wages associated with workplace-related injuries and illness sustained by your employees, this coverage ensures they can return to work quickly after experiencing injury or illness at work.
  • Commercial auto coverage: If your construction business owns vehicles that it uses for activities related to construction projects, commercial auto coverage should provide adequate protection. 
  • Excess/umbrella liability coverage: This protection provides added liability protection beyond what your primary policy can cover.

SummitCover: Your Trusted Partner for Construction Insurance and Risk Management

Now that you understand the different types of construction insurance available to you, let's discuss how SummitCover can assist with building confidence. As one of the long-time trusted partners within the construction industry, we provide:

  • Experience: Our team of construction insurance experts possess extensive expertise in understanding the individual requirements and risks for different construction projects.
  • Customization: Our experts cooperate with you and give a proper risk assessment taking into account the features of your project and provide you with the most adequate coverage plan.
  • Competitive Rates: Through our tight-fitting network with leading carriers, we can source attractive insurance quotes that match your needs at reasonable prices.
  • Risk Management Services: Our risk management competence goes beyond insuring and the staff here can offer risk reduction tips that can be used to minimize the occurrence of problems during the time of construction.
  • Claims Support: SummitCover offers claims support services if an accident happens that requires assistance; our dedicated representatives can guide the claim through efficiently while assuring fair compensation is provided.

SummitCover stands ready to assist both veteran contractors and newcomers alike as they begin construction projects of any scale or scope. Reach out today for an extensive insurance quote and expert guidance - building secure foundations begins with adequate protection!

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