Other Than Life (OTL) Practice Exam

What type of insurance would "Brant Construction" need to protect against damage to their unfinished building?

1. Installation floater

2. Builders risk

3. Commercial building form

4. Commercial building, equipment and stock

The correct answer is: Builders risk

Brant Construction would need builders risk insurance to protect against damage to their unfinished building. This type of insurance specifically covers structures under construction, including materials, fixtures, and equipment that are part of the building process. Builders risk insurance is designed to address the unique risks associated with construction projects, such as fires, vandalism, theft, and weather events that could cause damage before the project is completed. Installation floaters are typically used to insure goods that are in transit and do not provide sufficient coverage for the entire construction site. The commercial building form generally pertains to completed structures and is not suitable for ongoing construction. Similarly, the commercial building, equipment, and stock option covers established businesses with completed properties and their operations, but it does not address the specific needs related to structures that are still being built. Therefore, builders risk insurance is indeed the most appropriate choice for Brant Construction's circumstances, aligning well with the nature of their operations and the risks they face.