Construction Defect Insurance
Even if you’re an experienced, successful home builder, reasons will arise that you will want to carry construction defect insurance.
One of the more complex insurance policies out there, construction defect can be classified as nearly any condition that leaves a home, condo, or other building’s value diminished because of the defect.
Defects can include design, workmanship, and materials used on the job such as:
- Water seepage
- Concrete cracks
- Faulty or poorly designed drainage
- Installed irrigation
- Improperly used materials
- Inadequate fire protection
- Earth settlement
- Improper grading
- And countless other things
You need to protect your business from these risks by having a properly written construction defect insurance policy. Heaton Bennett Insurance in Austin, TX can help you find the right construction defect insurance policy for your construction business. If you build a structure that fails or becomes faulty, significant liability exposures can arise.
Heaton Bennett Insurance is a locally owned and operated insurance agency in Austin, TX. We invite you to complete an online quote, call us at 512-372-8311 to review coverage options for car insurance, home insurance, life insurance, business insurance, and more. We provide free, no hassle, and no obligation insurance quotes to help you make an informed insurance decision.
Frequently Asked Questions
Does general liability insurance cover construction defect claims?
General liability insurance may respond to certain covered claims involving bodily injury or property damage allegedly caused by construction work. It does not necessarily cover faulty workmanship, replacing defective work, or every dispute involving a project.
Can construction defect claims arise after a project is completed?
Yes. Some alleged defects may not become apparent until months or years after completion. Whether coverage may apply depends on the policy period, coverage form, completed-operations provisions, and circumstances of the claim.
Are construction defects caused by subcontractors covered?
Coverage involving subcontracted work depends on the policy language and applicable exclusions or endorsements. Contractors should verify subcontractors’ insurance, use written agreements, and review risk-transfer requirements with qualified professionals.
What is the difference between occurrence and claims-made coverage?
Occurrence and claims-made policies use different rules to determine which policy may respond to a claim. Texas contractors should understand applicable policy dates, reporting requirements, retroactive dates, and extended reporting options.
Does construction defect insurance replace warranties or performance bonds?
No. Insurance, warranties, and bonds serve different purposes. Coverage should not be assumed to pay for contractual guarantees, routine corrections, maintenance, or an obligation to complete work.