What Home Builders Insurance Do I Need For My Business?

The home construction industry is full of opportunity and risk. A project can go off track in many ways, from property damage and worker injuries to construction defects and vehicle accidents. That’s why a strong insurance program is one of your most essential tools on the jobsite, as it’s critical for protecting your business from financial losses, legal exposure, and costly delays.

Keep reading to uncover the six builders insurance policies every home builder should consider with expert guidance from Thomas McMillan, commercial lines staff underwriter at Central Insurance.

Why General Liability is the Foundation of Home Builders Insurance

If you’re in the new home construction industry, you need commercial general liability insurance, which provides coverage for third-party claims related to bodily injury, property damage, and personal or advertising injury. This type of insurance helps safeguard your company from financial losses due to lawsuits or accidents that occur as part of daily operations.

“Construction defect claims are one of the biggest risks home builders face,” McMillan explains. “These arise when something goes wrong with the finished structure, like a faulty foundation or poor framing, and can lead to costly litigation.”

To ensure adequate coverage, he recommends that your builder’s insurance policy should include:

• Products and completed operations coverage.
• Per project aggregates, which provide higher limits for each job.
• Contractor’s pollution liability to address risks from grading or excavation work that disturbs pollutants.
• Employment practices liability protects against claims of wrongful termination or discrimination.
• Contractor’s Errors and Omissions (E&O) covers mistakes that lead to financial loss but not property damage or injury.

Learn more: The Impact of Construction Inflation Rates in 2025

Workers’ Compensation Provides Coverage for Your Valuable Crew

No matter the size of your workforce, Workers’ Compensation insurance is essential, especially in the home construction industry. It protects your business and employees if someone gets injured on the job. 

According to McMillan, this is particularly important for builders who employ their crews. “Falls, heavy machinery accidents, and repetitive motion injuries are all common sources of claims in construction,” he notes.

With over 456,000 home builder businesses operating in the U.S.—a number that’s steadily growing—having the right coverage is more important than ever. Many states require Workers’ Comp—even if you only have one employee. Skipping this protection could result in costly fines or even personal liability.

To help streamline work injury claims and improve care, Central offers a 24/7 Nurse Hotline that connects injured employees with a registered nurse immediately after a workplace incident. This service ensures quick, expert medical guidance and initiates the claims process on the spot, saving time and helping your crew members get the care they need fast.

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Builders Insurance Protects Commercial Vehicles on the Move

Whether you operate one company truck or a whole fleet, commercial auto insurance is another vital policy. “Most home builders are traveling between jobsites every day,” McMillan states. “That creates a significant auto liability exposure.”

He recommends talking to your Central agent to ensure you have comprehensive coverage for the size of your business and fleet, which includes auto liability coverage, physical damage protection for company-owned vehicles, and non-owned auto coverage if employees use personal vehicles for work.

Fleet safety is critical for protecting your drivers, vehicles, and bottom line. To reduce the potential of a loss event, it’s beneficial to promote safe driving habits within your team, including training, vehicle maintenance, and clear policies. You can reduce accidents, lower costs, and keep operations running smoothly by prioritizing driver safety and staying proactive.

Safeguard Your Physical Assets With Property and Inland Marine Insurance

From your tools and equipment to your office space or storage yard, protecting your physical assets is another layer of defense. Commercial property insurance can cover buildings you own, while inland marine insurance can provide financial protection for tools and mobile equipment wherever they go away from your premises.

Commercial property coverage helps protect against property damage caused by events like natural disasters, fires, or theft. When choosing types of coverage and coverage limits, McMillan recommends evaluating everything inside—from office furniture and equipment to employee belongings and fixtures—to ensure full protection.

Inland marine is an endorsement that can provide flexible protection for property and equipment that moves or is stored off-site, covering tools, materials, and other valuable assets that aren’t protected by standard property policies.

Enhance Your Builders Insurance With These Key Coverage Add-Ons

McMillan recommends that home builders consider Builder’s Risk insurance, a special type of property coverage for new construction builds offering protection for your investment during the construction phase. It can cover the jobsite, including materials and structures that are part of the project.

Because a single accident can easily exceed the limits of your primary liability policy, an umbrella insurance policy is crucial coverage to add to your overall builders insurance portfolio. 

“Lawsuits and medical bills add up fast,” McMillan explains. “Umbrella coverage provides additional protection when your general liability or auto limits are maxed out.”

He also notes that even a relatively small incident—like a subcontractor injury or a vehicle accident—can result in a seven-figure claim. Umbrella insurance ensures your business isn’t left footing the bill.

Partner With a Trusted Expert in Builders Insurance

With nearly 150 years of experience and a strong financial foundation, Central stands out for its dedication to contractors and builders. The company partners with nearly 400 hand-selected independent agents across the U.S. and backs its policies with nationally recognized claims and loss control teams.

In addition, Central offers access to construction-specific loss control professionals who can help your team build safer worksites, reduce claims, and improve compliance.

From the first shovel in the ground to the final walk-through, every step in home construction carries risk. But with the right builders insurance program in place, you can build with confidence, knowing your people, property, and reputation are protected. Talk to your Central agent today to learn how to tailor coverage to your operations and ensure you have the right protections in place from day one.