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The following claims examples provide common scenarios where a claim may occur under a Builders Risk policy.
Note: These Claims Examples are for illustrative purposes only. Please remember that only the insurance policy governs the coverage terms, conditions and exclusions.
A general contractor was hired to renovate and expand a sports centre. The driver of a boom truck damaged the steel cladding of the building while trying to remove temporary propane tanks from the project site. The truck had been rented from a company hired by the insured’s mechanical subcontractor.
Construction work was being carried out on a school during the summer months, when vandals broke into the school at night and started a fire causing damage in different areas of the insured project. Cleanup and repairs to the project needed to be completed prior to the school opening in the fall.
During the construction of an addition to an existing facility, a subcontractor unknowingly struck an exposed cooling coil which began to leak. A significant amount of water leaked into the facility and went undiscovered, as it was hidden in the cavities of the structure. Once the leak was discovered, there was physical evidence of impact damage to the coil.
During construction of a new multi-unit condominium building, a water leak was discovered emanating from a copper water pipe connected to an exterior outlet in one of the units. The investigation revealed that the caulking around the balcony area had not been properly applied which allowed cold air to come into contact with the pipe and resulted in the line freezing and ultimately water damage to the project.
A contractor was constructing a new 50-storey condominium building, which required the selective demolition of an existing building for incorporation into the insured project. Severe damage to the project occurred when water escaped from an unprotected domestic waterline which froze and ruptured in two unfinished suites.
Theft of Copper Wiring and Piping
Thieves managed to gain access to a secured project site for a medical treatment facility and stole a large quantity of copper wiring and piping. Some of the materials had already been installed by an electrical subcontractor working on the site. The thieves specifically targeted the copper-based products as they are a highly sought-after commodity for the high recycling value at recycling centres.
During the installation of a new steel girder and concrete bridge, the steel girder assembly slipped off its supports, causing severe damage to the end sections of the steel beams. The cause of the loss was determined to have resulted from a poorly designed installation procedure. The damaged sections of the steel beams were removed and replaced with the aid of two large mobile cranes.
An owner and general contractor planned to begin the construction of three hydroelectric projects. Torrential rains caused flooding and damage to cofferdams and power stations, which also caused a delay in the start-up of the project. A claim for over $12 million was made for the physical damage to the project, as well as the lost revenue from the inability to sell electricity for a period of time.
The project involved the construction of a 31-storey, residential high-rise condominium with ground-level town homes. The construction of the high-rise building was one week away from final completion when a hot water line connection to a 17th floor dishwasher ruptured. Water escaped for approximately 14 hours before being turned off. Several thousand gallons of water were estimated to have escaped, which affected 55 units in the building, and damaged the building’s electrical, communications, fire detection and elevator systems.
Commercial Retail Building
A contractor was retained to act as a general contractor for a project involving the construction of a commercial retail building. The contractor stored the interior finishing materials for the project in his warehouse a few kilometres from the site of the project. A fire broke out in the warehouse, completely destroying its contents.