The construction industry is essential to communities across Virginia. But for today’s home builders, especially those managing crews, subcontractors, and big-ticket projects, the job now comes with more liability than ever.
Builders already deal with high-risk conditions: job site injuries, property damage, and subcontractor mistakes. Without the right protection, even one lawsuit could put a business and personal assets on the line.
This article explains what umbrella insurance covers, why your general liability policy might not be enough, and how to decide if this extra layer of protection makes sense for your operation. Whether building custom homes or balancing multiple contracts, you will get clear, practical advice to protect your future.
What Is Umbrella Insurance, and What Does It Actually Cover?
Umbrella insurance is extra liability protection that steps in when your other policies reach their limit. It does not replace your general liability, commercial auto, or employer’s liability; it adds another layer on top of these core policies.
For example, if your general liability policy covers up to $1 million but you are hit with a $2 million lawsuit, umbrella insurance can cover that extra million. Without it, your business or even your personal assets could be at risk.
Here is what umbrella insurance typically covers for home builders:
- Bodily Injury Claims
If someone gets hurt on your job site and the damages exceed your policy limits, umbrella coverage helps pay the difference. - Property Damage Claims
Mistakes happen. If a contractor accidentally floods a finished basement or damages a neighboring property, those costs can add up quickly. - Legal Defense Costs
Even if a claim turns out to be baseless, you still have to defend yourself. Umbrella policies often cover legal fees and court costs when your other policies max out.
Umbrella insurance is an extension of general liability, commercial auto, and employer’s liability (part of workers’ compensation). It is the kind of backup you hope you never need but are glad to have should you encounter the unexpected.
Why Standard Home Builders Insurance Might Not Be Enough
Most home builders carry general liability coverage with limits of one to two million dollars. That might sound like enough until you need to file a claim that goes higher.
Lawsuits tied to construction accidents, faulty work, or subcontractor injuries can become expensive quickly. One serious claim can exceed your standard coverage and leave you financially exposed.
For example, if a subcontractor falls from scaffolding and suffers a permanent major injury, the total claim could easily reach over two million dollars. If your general liability policy covers the first one million, what happens to the rest? Without umbrella insurance, that monetary gap becomes your responsibility.
In high-risk industries such as construction, those gaps are not rare. The size of potential liabilities increases as you scale to bigger projects. Umbrella insurance is not just necessary for big companies.; it is for smart companies that know to stay ahead of risk.
When Should a Home Builder Seriously Consider Umbrella Insurance?
Not every builder needs umbrella insurance right away. But if your business checks even one of the boxes below, it is prudent to take a closer look.
- You Build Custom or High-End Homes
Bigger jobs risk bigger potential claims. Larger crews, increasingly complicated logistics, and more expensive properties and materials can lead to claims that outpace your coverage. - You Work with Multiple Subcontractors
More moving parts mean more chances for something to go wrong. If a subcontractor causes harm, you could still be held responsible. - You Have Had Claims in the Past
Even one incident can raise your risk profile. Umbrella insurance helps you protect yourself from future surprises. - You Operate in a Litigious Area
Some areas see more lawsuits than others. If you are building in regions known for high-value homes or frequent claims, added protection makes sense. - Your Contracts Require Higher Coverage Limits
More clients now require umbrella insurance as part of their contract terms. Meeting those requirements can help you win more bids. - You Have Vehicles or Employees on the Road
A serious auto accident involving one of your trucks can lead to massive liability. Umbrella insurance adds cushion to your commercial auto policy.
If any of these apply to your business, umbrella coverage should be a serious consideration. An insurance provider experienced in the building industry can highlight areas of specific risk based on industry and geographical factors.
Contact Burton & Company For Help Choosing the Right Coverage
At Burton & Company, we understand the particular risks that home builders encounter. From subcontractor liability to job site injuries, we know how quickly a claim can grow. That is why we work with builders across Virginia to create custom insurance solutions that include strong umbrella protection.
Our team works with carriers familiar with the construction industry and help us find policies with competitive rates and fewer restrictions. We also stay with you after the policy is signed to make sure your insurance evolves as your business grows.
With Burton & Company, you get more than an insurance provider. You get a partner who is invested in protecting your work, your team, and your future. Contact us today for help choosing the right insurance coverage for your activities.
