When you are building a new home, you will need insurance to protect yourself while the home is under construction. If you are hiring a licensed general contractor, he will most likely have some insurance in place to cover the bulk of the requirements. However, if you are going to be an owner builder and oversee the construction yourself, you will need to get insurance coverage to protect the home and yourself.
Owner Builders have their own unique set of insurance requirements. You will typically need to obtain a "Builder's Risk" policy. If you hire a general contractor to build your home, he would have the insurance. In this case, you would not even have to think about it. But, since an owner builder acts as his own GC, you must be aware of the need for a Builder's Risk policy.
A builder's risk policy provides protection to the property as it is being built. This usually includes protection against theft and damage (natural or man-made) during construction. Once construction is finished, you will obtain a standard homeowner's policy.
For owner builders, the Builder's Risk policy (also known as Course of Construction) should be large enough to cover the replacement costs, or replacement value of the structure itself. For example, if you are building a home that will be worth $300,000, then a portion of the value is in the land. If the land is worth $100,000, then you want to make sure your Builder's Risk policy has a coverage of at least $200,000 to protect the structure (minus the land).
It is important for owner builders to shop for the right kind of builder's risk policy. Many insurance agents will try to sell you a commercial builder's risk policy - either by mistake or because that is all they are aware exists. You will know you are getting a commercial policy when you see one thing - the price tag. Commercial policies cost several thousand dollars, so it will jump right out at you.
By contrast, a personal policy should cost a few hundred to no more than a thousand dollars in most cases. And it will never cost more than about two thousand dollars.
For owner builders, the costs of the insurance policy will vary based on the coverage amount, the property's distance from a fire station, distance from fire hydrants, the flood zone classification, etc.
Often you can find a homeowner's policy that has a "course of construction" clause built into it. This is probably the best and most affordable way for owner builders to get a builder's risk policy.
It is also nice because once you are finished building, it automatically becomes your homeowner's policy. Be sure to tell your agent you want a homeowner's policy that includes a course of construction clause or "rider" first.
Then, ask for a builder's risk policy if the homeowner's policy is not available. If one agent tells you he cannot provide either of these, call other agents. These policies are out there in all 50 states.
They are just not as well-known, even to the agents who sell them. Even agents who work for companies that offer these policies often do not know they are available. Shop around and ask your loan professional for a referral if you need.
As a side note, whether you are using a general contractor or building as an owner-builder, you may want to consider purchasing a liability insurance policy. Whereas builder's risk protects against damage to the structure, a liability policy will protect you, the owner of the property.
Imagine a kid sneaks onto your land to play in the half-built house at night. If that kid gets injured, your liability policy will help protect you from any legal claims against you.
If you are hiring a builder, the builder should already have liability coverage, but you will want to double check to make sure you understand what your liabilities are as the owner of the land. Then, you may still want to consider purchasing your own liability coverage.
Owner builders will definitely want to consider purchasing their own coverage. Most owner builder construction loans won't require liability insurance to close the loan. Most lenders simply want to see that you have the builder's risk policy.
However, as an owner builder, you should consider protecting yourself through the liability insurance. And, of course, protect your property with a comprehensive builder's risk policy.
Do not actually buy your insurance policy until you have consulted with a construction loan professional. Don't assume you are saving yourself time by buy the policy now, as it may be the wrong policy for the loan.
Check with your loan professional and even let them speak to your insurance agent to arrange for the right policy. Any good loan professional should do this for you.
It’s kind of nice being in the “do it yourself kind of business" like soundproofing. In today’s world taking the family out on a Friday night for dinner and a movie might cost you more than your monthly mortgage payment. That is why many families are opting for their very own home Theater. If you have a spare room or an empty space in your basement or attic, you have a potential Home Theater. It used to be that the best way to build a home theater or a home studio was to construct new wall within the existing room and then build what we call a “Room within a room." Though this method of soundproofing is still quite effective, it is costly and eats up a lot of wall space in your already cramped theater room. A better suggestion is to work with your existing walls by applying a new layer of drywall to the existing walls and ceiling but applying a layer of a product called Green Glue on the new drywall and sandwich it in between the existing wall and the new drywall. If you do this to all the walls and the ceiling you are well on your way to a great soundproof home theater. Now if your home theater is on a second floor, the ceiling now becomes less of a concern and now the floors become more of an issue. Floors can be soundproofed in many different ways depending on what the finished floor is going to be installed. If you are planning on having carpet and pad for the finished floor in your theater, then a soundproof floor underlay would be in order. Something like American Impactless soundproof floor underlay or American Impact Standard underlay. These are both recycled rubber products that would lie atop of the wood or concrete sub floor to stop the airborne sounds of the home theater from traveling down to the people below. The Impactless is a less dense rubber underlay and would be perfect for under carpet and pad. The American Impact Standard would also be effective under the carpet and pad, but is more suited for hardwood and ceramic tile floors due to its sheer mass. Other concerns that you might have with your home theater would be doors and windows. Let’s talk about doors for a minute; if you are trying to keep the movie in the home theater, then a hollow core door could be your worst enemy. Most modern bedroom doors are hollow core and do little in the way of soundproofing. Your best bet would be to go to Home Depot or Lowe’s and purchase a solid core MDF or solid wood door. You could ad an automatic drop down transom seal to the bottom of the door and also a door perimeter seal kit to seals around the door where it closes into the jam. A real soundproof door could cost thousands, with a little time and careful planning; you can get the same results at ¼ the cost. The last thing we need to talk about are the windows in your home theater. If neighbors are a concern, then I would suggest building window plugs with the 2" America Mat closed cell vinyl nitrile foam mat. For example, if your window were 3’ X 3’, you would cut the foam to 3’1" X 3’ 1" thus giving the window plug and extra ½" around it’s entire perimeter. This extra ½" will help to hold the window plug tightly into the window frame much like a cork in a bottle. If the window is 4’ or more on either dimension, it is suggested that the window plug be glued to a backer board, something like wood paneling or Luaan. These wood panels can be found at home Depot or Lowe’s. Well, I think we have covered every aspect of building your very own home theater; next time we will discuss acoustical treatments for your theater, until then, Dr. Bob…. Out!!!
Both Chris Esposito & Robert W. Orther Orther are contributors for EditorialToday. The above articles have been edited for relevancy and timeliness. All write-ups, reviews, tips and guides published by EditorialToday.com and its partners or affiliates are for informational purposes only. They should not be used for any legal or any other type of advice. We do not endorse any author, contributor, writer or article posted by our team.
Chris Esposito has sinced written about articles on various topics from Real Estate, Free Credit Report Score and Real Estate. Chris Esposito provides owner-builder construction financing nationwide through his Owner Builder 101 program. Visit to get all the inf. Chris Esposito's top article generates over 40500 views. to your Favourites.
Robert W. Orther Orther has sinced written about articles on various topics from Sound Recording, Home Improvement and Insurance. Dr. Bob is the Senior Technical Advisor at Soundproofing America Inc, the leading authority in Soundproofing and Acoustical treatment technology.Dr. Bob O.Soundproofing America, Inc.Senior Technical DirectorSoundproofing Expe. Robert W. Orther Orther's top article generates over 33100 views. to your Favourites.