Can builder's risk insurance be extended if the project is delayed?
Yes, builder's risk insurance can typically be extended if your project is delayed, but you need to request this extension from your insurer before the current policy expires.
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Complete Guide to Extending Builder's Risk Insurance for Delayed Construction Projects
Why This Question Matters for Colorado and Utah Residents
Construction delays are common in Colorado and Utah, where weather, permitting, and supply chain issues often disrupt timelines. Having a coverage gap could mean tens of thousands of dollars in exposed risk for business owners and contractors.
- Regional Weather Risks: Severe hail, snow, and wildfire seasons in Colorado and Utah frequently delay project completion dates.
- Strict Local Regulations: Inspections, permit backlogs, and code upgrades (especially in growing cities like Fort Collins and Salt Lake City) regularly push schedules back.
- Real Financial Impact: Delays can lead to uncovered losses. On average, a 2-month project delay can require $1,200–$3,000 in additional premium for a $1M policy, but prevent $50,000+ in uninsured loss from fire or theft if coverage lapses.
What Most People Get Wrong
Many assume builder’s risk policies automatically adjust to match project completion—this is not true. In both states, coverage typically ends on the policy's specified expiration date, no matter what happens on-site. Some owners think they can apply for an extension after their coverage expires, but once it lapses, insurers almost never retroactively reinstate coverage for losses that occurred during the gap.
A second common misconception is underestimating the paperwork and approval time required for an extension—Colorado and Utah insurers often require 7–21 days advance notice, proof of active construction, and updated completion schedules to process extensions.
The Complete Picture
Builder’s risk insurance protects your structure and materials during construction. If your project gets delayed, you can usually extend your policy, but you must act before the expiration. Your insurer will generally ask for documentation explaining the delay (weather reports, permitting delays, etc.), and you may need to pay an additional premium based on the extended period and any increased risk.
Failing to secure a timely extension means your site could be exposed during some of the highest-risk months. For example, in Colorado, hail season peaks in June, while in Utah, freeze-thaw cycles in spring can push timelines and introduce new property risks. Always notify your agent as soon as you suspect a delay, and never assume coverage continues unless you have written confirmation.
Making the Right Decision for Colorado and Utah Residents
Question 1: Did your project face a qualifying delay under your policy?
Delays that may be considered include:
- Severe weather (hail, wildfire, late snow)
- Permitting/inspection backlogs (common in Denver, Fort Collins, Salt Lake City)
- Supply chain disruptions or labor shortages
Gather documentation. Local permitting offices or weather data can help justify your extension request.
Question 2: Have you contacted your insurer before coverage ends?
Act quickly—many policies in both states require requests 2–3 weeks before expiration. Missing this window could leave your project totally uninsured for the final weeks, even if delays were out of your control.
Question 3: What would a gap in builder's risk coverage cost you?
Calculate the total value of installed materials, equipment, and completed work still at risk. For a $700,000 structure, an uninsured theft, fire, or storm event could create devastating out-of-pocket costs. Protect your business finances and reputation by coordinating extensions well ahead of deadlines.
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Real World Examples
Fort Collins Remodel Delayed—Timely Extension Saves the Budget
Background: Michael, a contractor in Fort Collins, managed a $900,000 retail renovation on Harmony Road. His builder’s risk policy was set to expire on June 30, but unexpected delays from a June hailstorm pushed the finish date to mid-August.
Coverage: $900,000 builder’s risk with theft and vandalism add-ons.
Monthly Premium: $175/month ($2,100/year)
The Incident: Before work wrapped, copper wire and tools worth $24,000 were stolen from the locked site.
Total Claim Cost: $24,000 (police report, scheduled property)
Michael's Cost: $1,500 deductible—the insurer covered the rest due to the timely extension.
"If we'd missed that extension docket, we would have eaten the entire loss. FoCoIns reminded us just in time—absolutely saved our cash flow."
Salt Lake City Apartment Build—Permit Backlog and Last-Minute Extension
Background: Lisa's construction firm began a $2.2M apartment project near Sugar House, Salt Lake City. Local permitting delays pushed the finish date past the original December policy end. Lisa requested a 60-day builder’s risk extension two weeks before expiry, providing municipal proof of delay.
Coverage: $2.2M builder’s risk, broad form including soft cost endorsements.
Monthly Premium: $320/month ($3,840/year; extension: $650 for two months)
The Incident: A windstorm during the extension period damaged roof trusses, causing $39,000 in losses and repair delays.
Total Claim Cost: $39,000 (emergency structural repairs, weatherproofing, engineering fees)
Lisa's Cost: $2,500 deductible, all covered under the policy extension.
"Had we let the policy slip, this windstorm would've blown our budget and timeline. The extension was worth every penny for peace of mind and continuity."
Boulder Custom Home Build—Missed Extension Means Uninsured Loss
Background: Josh’s Boulder-based homebuilding team was nearing completion on a $1.1M custom residence. City inspections delayed occupancy, but the builder’s risk policy expired in September—unnoticed.
Coverage: $1.1M builder’s risk, standard perils
Monthly Premium: $210/month ($2,520/year)
The Incident: In the two-week gap after the policy lapsed, a break-in resulted in $12,000 in stolen appliances and interior fixtures. Insurer denied the claim due to lapsed coverage.
Josh's Cost: Full $12,000 loss out-of-pocket—no recovery possible.
"Missing that renewal reminder was a huge (and costly) oversight. One paperwork mistake, and you're on the hook. Won't happen again."
Avoid These Common Mistakes
Mistake #1: Waiting Until After the Policy Expires to Request an Extension
What People Do: Contractors or owners overlook the builder’s risk expiration date, then try to extend or retroactively reinstate coverage after the policy has lapsed.
Why It Seems Logical: They assume insurers will be flexible if construction delays are outside of their control.
The Real Cost: Most insurers in Colorado and Utah will not backdate coverage. Any damage, theft, or weather loss during the gap is 100% out-of-pocket—often $10,000 to $100,000 or more.
Smart Alternative: Track your builder’s risk expiration closely and alert your agent at least 30 days ahead of any potential overrun. FoCoIns clients receive advance reminders and hands-on support with extension paperwork.
Mistake #2: Assuming All Construction Delays Qualify for an Extension
What People Do: Builders or owners request an extension for any delay, not realizing insurers need proof (like city permit delays, adverse weather, or material shortages) and may deny purely financial or management-related overruns.
Why It Seems Logical: The complexity of real-world construction means delays feel unavoidable, so any reason should suffice.
The Real Cost: If an insurer denies your extension for an unapproved reason, you’re left uninsured for the remaining construction period—potentially exposing $500,000+ in assets with no safety net.
Smart Alternative: Work with local experts like FoCoIns to compile necessary documentation and ensure your reason for extension matches approved standards. We help gather municipal letters, weather reports, and photographic evidence to ensure your application is accepted swiftly.
Mistake #3: Failing to Update Extension for Increased Project Value
What People Do: Owners extend the policy without increasing coverage after project upgrades or added scope (e.g., high-end finishes, additional square footage).
Why It Seems Logical: They assume initial policy limits carry through, regardless of project changes.
The Real Cost: A claim during the extension may only pay up to the outdated limit, leaving $50,000 or more of new work uninsured.
Smart Alternative: Conduct a full project review before any extension. FoCoIns will help you accurately update coverage and avoid costly underinsurance at a critical point in your build.
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