Nearly every project, whether here in California or elsewhere, involves numerous moving parts. In order to protect yourself from any adverse events that could occur during a development project, you may want to consider several types of insurance. This may seem like an obvious choice, but what may not be as obvious to a new developer is what you need to properly insure your project and protect your interests.
This may vary depending on the type of project and those you work with on it. You may decide to rely on your general contractor’s insurance. However, you could find that you need additional insurance unique to your project.
In order to protect yourself against damage to the property itself, you will more than likely obtain builder’s risk insurance. You have numerous options for this type of insurance as well. The policy you obtain depends on your project parameters. Things get more complicated when you attempt to insure yourself against design issues. The most economical option involves relying on your design team’s insurance.
Two other insurance options are project professional liability insurance and owners protective professional indemnity insurance. Finally, you may consider a developers professional liability policy. You may want to discuss the potential disadvantages of doing so, along with the advantages, of each option.
Insurance is just one aspect of a development project that requires your attention. You may have several questions regarding making sure that your project remains in compliance with any relevant federal and California laws, including those requiring you to obtain the proper insurance for your project. It may be beneficial to discuss this and your other legal concerns before embarking on this venture.
Source: cavignac.com, “Professional Liability Insurance — What are a Developer’s Options?“, Jeffrey Cavignac, Accessed on April 8, 2018