A builders risk policy has homework in it, and the site crew has to do it.
Exclusions tell you what is not covered. Conditions and warranties tell you what you have to do to keep the cover you paid for. Break one and a perfectly ordinary fire or water loss can be argued over for months, or declined outright.
Start a quote file Read the short answer firstPermit, fire watch, and a record of both.
Fencing and lighting are part of the cover, not decoration.
A stalled site has to be reported.
What are the conditions on a builders risk policy, and what happens if we break one?
They are promises about how the site will be run, written into the policy as warranties or protective safeguard conditions, and they usually cover hot work, site security, water and freeze protection, and telling the insurer when the schedule changes. Breaking one does not automatically end the policy, but it can give the insurer grounds to contest the claim, and how far that goes depends on the wording and on whether the breach had anything to do with the loss. Either way it turns a straightforward claim into an argument.
Breaches happen because the conditions live in a document in an office and the work happens on a site. The best thing a contractor can do with a builders risk policy is read the conditions page once, at the start, and put those requirements into the site routine rather than into a filing cabinet.
An exclusion removes a category of loss, and that is plain from the start. A warranty is different, because the cover was there and a breach on site is what puts it in question. These conditions exist because a site under construction has no sprinklers running, no permanent alarm, unlocked openings and a rotating cast of trades. The conditions are the substitute for the protection a finished building would have.
Read these before the first delivery arrives.
Hot work
Welding, cutting, grinding, torching and roofing usually require a written permit, the area cleared and screened, an extinguisher present, and a fire watch kept for the period the policy or the applicable standard requires after the work stops. The paperwork is the point. A fire watch that was kept but never recorded is very hard to prove months later, and the permit book is what proves it.
Site security
Perimeter fencing, lighting, locked storage, cameras or a patrol. These often appear as a warranty rather than a suggestion, and sometimes with specific requirements once the value on site passes a stated point. If your site plan changes, or the fence comes down early to let equipment in, that is a change to the risk the insurer agreed to.
Water and freeze protection
A water loss in a partly enclosed building can run to every finished floor below it. Policies commonly require that heat is maintained once systems are charged, that the site is monitored over a shutdown, or that water is drained. A long weekend in December with the heat off is exactly the claim these conditions exist to prevent.
Telling the insurer when things change
Builders risk is priced against a schedule, a value and a scope. If the completion date moves, the contract value rises, work stops for a period, or the building is partly occupied before completion, the policy needs to know. Most of these are express conditions, and all of them are easier to handle in advance than to explain afterwards.
Three illustrations, not client files. Nobody in them does anything reckless.
The last cut of the day
A sub finishes a small piece of cutting at the end of the shift and leaves. There is a permit system, and it has been used all week, but the last job is not written up. A fire starts overnight, and the entire conversation afterwards is about a missing sheet of paper rather than about the fire.
The fence that comes down early
Landscaping needs access, so a section of fencing comes down near the end of the job, at exactly the point when the finished value on site is at its highest. The security warranty refers to a continuous perimeter. A theft through the gap makes the connection between the breach and the loss uncomfortably direct.
The project that quietly stops
Funding pauses and the site sits with no trades on it. Nobody tells the broker, because nobody thinks of a pause as an insurance event. An unattended site is a different risk, and most policies end or suspend cover once the site has sat idle for a set number of days, unless the insurer has agreed in writing to carry the pause. A water loss during the pause turns into an argument about whether cover was still in force, not about the water.
The ones worth settling at the pre-construction meeting.
Where do I find the conditions on my policy?
Some sit in the main wording, and the project-specific warranties are usually on an endorsement behind the declarations page, which is why they get missed. Send the whole policy rather than the certificate and you will get a plain summary of what the policy asks the site to do, in writing.
A subcontractor broke the condition, not us. Does that matter?
It can. On some forms a breach by any insured, subcontractors included, can be held against the claim. Others say a breach in a part of the site you do not control, or one that did not cause the loss, does not defeat your claim. What happens between you and the sub afterwards is a contract question. The practical answer is that the conditions have to be pushed down into the trade contracts and onto the site, not just accepted at the top.
Does breaking a condition void the whole policy?
It depends on the wording and on the circumstances. Some conditions suspend cover only for loss connected to the breach, some are written more broadly, and how they are applied is a question of the policy language and the facts. That uncertainty is the reason to treat them as operational requirements rather than as legal fine print. If a claim is ever declined on a warranty, that is a question for a lawyer.
We are doing hot work anyway. Is a permit system worth the trouble?
It is the record an insurer will ask for after a fire. A permit book, a named fire watch and a clearance check take minutes per job and produce the record that decides the claim. WorkSafeBC sets its own rules for this work, separately from anything your insurer asks. Its health and safety regulation covers welding, cutting and allied processes, including keeping a fire extinguisher immediately available where welding or cutting is done. Worth reading once and building into the site routine: WorkSafeBC, welding, cutting and allied processes (opens in a new tab).
The schedule has slipped. What do I actually need to do?
Tell your broker the new completion date and whether work has stopped or is continuing at reduced pace. Builders risk runs for a term and for a project, and the two need to stay aligned. Extending in advance is routine. Extending after the original expiry, on a project that has had a loss, is not.
Not the question you had? Send the policy and the site details through the quote file and you will get a written answer, not a sales call.
Get the conditions onto the site, not into a drawer.
Send the policy and you will get a plain-words summary of what the policy asks the site to do. The wording still governs.