In a commercial property policy, what does "builder's risk" cover?

The "builder's risk" coverage in a commercial property policy specifically protects property that is under construction or renovation. This type of insurance is designed to cover various risks associated with the construction process, such as damage to the building materials, supplies, and the structure itself while it is being built or altered. It typically includes perils like fire, wind, theft, and vandalism that can occur during the construction phase.

This coverage is particularly important because the property is often vacant and exposed to hazards that might not affect a completed building. Additionally, it addresses the unique needs of contractors and project owners who need protection from losses specifically occurring at the construction site before completion.

The other options do not accurately describe the focus of builder's risk coverage; instead, they pertain to different types of coverage or exposures. For example, completed structures against vandalism would fall under a general property policy rather than builder's risk. Similarly, coverage for equipment used in construction would be addressed under a different type of policy, such as a tools and equipment policy. Liability for contractor's mistakes is covered under liability insurance, not builder's risk. Thus, the most accurate representation of builder's risk is its protection for property being constructed or renovated.