So you’ve finally pulled the trigger on that kitchen gut job, the master bath addition, or maybe knocking out a wall to open up the living space. Home remodels are exciting, and around Wilmington, they’re more popular than ever. But here’s a question most homeowners never think to ask until something goes sideways: Is your project actually covered if something goes wrong mid-construction?
That’s where Builder’s Risk Insurance comes in, and honestly, it’s something more people should know about before they break ground.
To put the stakes in perspective, Harvard University’s Joint Center for Housing Studies projects that spending on home improvements and repairs will hit $509 billion in 2025. With that kind of money going into renovation projects across the country, the cost of an uninsured loss isn’t just an inconvenience. It can be devastating.
What Is Builder’s Risk Insurance and What Does It Cover?
Builder’s Risk Insurance, sometimes called course of construction insurance, is a policy designed specifically to protect a property and its materials while a construction or remodeling project is actively underway. Your standard homeowners insurance policy was not typically designed to cover the added risks that come with an open structure, construction crews, and expensive materials on site. In many cases, insurers can deny claims related to major renovations under a basic homeowners policy.
A Builder’s Risk policy generally covers damage or loss caused by fire, theft, vandalism, wind, and certain other perils. It can also cover building materials stored on site or in transit, temporary structures like scaffolding, and, in some cases, soft costs like architectural fees if a covered loss causes a delay. The coverage is typically written for the duration of the project, whether that is three months or twelve.
Who Actually Needs Builder’s Risk Insurance?
This is the part that surprises people. It is not just the general contractor who needs this coverage. Anyone with a financial stake in the project should consider it.
Homeowners Taking on a Significant Remodel
If you are a homeowner in Wilmington, Hampstead, or Holly Ridge and you are doing more than minor cosmetic updates, you are likely exposed. Structural changes, full room additions, major electrical or plumbing overhauls, and similar projects all create coverage gaps in a standard homeowners policy. If a storm rolls off the coast and damages your partially completed addition, or a fire breaks out while your kitchen is torn down to the studs, you could be looking at a significant out-of-pocket loss without the right coverage in place.
Contractors and Builders
General contractors and specialty tradespeople working on a project can also carry Builder’s Risk Insurance, and in many cases, lenders or project owners require it. If you are a contractor in the Wilmington area managing a remodel, having this coverage demonstrates professionalism and protects both you and your client from catastrophic loss during construction.
Property Investors and Flippers
If you buy a distressed property to renovate and resell, your investment is at risk from the moment you start demo. Builder’s Risk Insurance is a smart layer of protection for anyone putting significant capital into a property that does not yet have full structural integrity.
Lenders
If a construction or renovation loan is involved, many lenders require Builder’s Risk coverage before they will release funds. This is especially common with larger remodel projects where the loan-to-value ratio changes as work progresses.
Coastal Homeowners Should Pay Extra Attention
Living and working along the North Carolina coast means dealing with real risks that inland areas simply do not face at the same level. Hurricanes, tropical storms, high winds, and flooding are part of life in New Hanover, Pender, and Onslow counties. When your home is mid-remodel and a storm is in the forecast, the exposure is dramatically higher than a fully enclosed, finished structure.
Builder’s Risk Insurance for remodels in this region should be reviewed carefully for wind and water coverage, as coastal properties may have different terms than standard policies. Working with someone who understands the local risk environment is not just helpful, it is essential.
Get the Right Coverage with Coastal Contractors Insurance
At Coastal Contractors Insurance Agency, we work with homeowners, contractors, and business owners across Wilmington, Hampstead, and Holly Ridge to make sure they are protected when it counts. With over 15 years of experience and access to a wide network of carriers, we know how to find Builder’s Risk Insurance coverage that actually fits your project and your budget. Do not leave your remodel exposed. Contact Coastal Contractors Insurance Agency today for a quote and a full insurance policy review. We will make sure you have the right coverage in place before the first nail is pulled.