Nearly $2.5B in Weather Losses: Is Your Build Protected?

Sam Kotob
20 August 2026

Builders Risk Construction Insurance Contractors Risk

Canada’s severe-weather losses are sending a clear message to property owners, builders, developers, and contractors.

The risk does not begin after a building is finished.

It can begin while the roof is still open, the windows are not installed, materials are sitting on-site, drainage is temporary, and the project schedule is already under pressure.

In 2025, severe-weather-related insured losses in Canada exceeded $2.4 billion, making it the tenth costliest year on record for severe-weather-related insured losses in the country. That followed 2024, when severe-weather insured losses surpassed $8 billion, making it the costliest year on record.

Download the 2026 Course of Construction Insurance Brief

For active construction projects, this is not just a property insurance story.

It is a Course of Construction insurance story.

Severe Weather Does Not Wait for Completion

A completed building usually has sealed openings, finished roofing, installed windows and doors, working drainage, permanent systems, controlled access, and completed protection.

A building under construction may not.

That is the problem.

At different stages of a project, the site may have:

unfinished roof systems
temporary coverings
exposed materials
open window and door openings
incomplete drainage
temporary heat or electrical
stored equipment
partially secured access
delayed inspections or handover dates

One storm can do more than damage the property.

It can delay the schedule, increase soft costs, affect financing, create lender concerns, push back occupancy, and trigger difficult questions about what is or is not covered.

That is why Course of Construction insurance should not be treated as a box to check before work begins.

It should be reviewed as part of the project’s risk plan.

The Most Vulnerable Stage Is Before the Building Is Watertight

One of the most important stages in any construction project is the period before the building is fully watertight.

This is when the project may be structurally underway, but still exposed.

Water can enter through unfinished roof sections, open walls, incomplete windows, temporary coverings, unfinished drainage, lower levels, or materials that were delivered before the site was ready.

Travelers Canada notes that water is one of the leading causes of damage to buildings under construction, especially when drainage systems are incomplete, exterior openings are unfinished, or roof drains are obstructed.

For builders and property owners, the question is simple:

If water gets into the project before completion, do you know how your policy would respond?

That answer should be clear before the loss, not after it.

Builder’s Risk Is Not Just About the Building

Course of Construction insurance, also called Builder’s Risk insurance, is designed to help insure a project while it is being built, renovated, repaired, or expanded.

Depending on the policy, it may include coverage for the building under construction, project materials, temporary works, fixtures, equipment being installed, and certain property stored off-site or in transit.

But coverage depends on the wording.

That means builders, developers, contractors, and property owners should not assume every exposure is automatically included.

Before work begins, the insurance conversation should answer:

What exactly is insured?
Who needs to be named on the policy?
Is the full project value reflected?
Are materials covered on-site, off-site, and in transit?
Is the existing structure included or excluded?
Are soft costs or delay in completion included?
What happens if the project runs past the policy expiry date?
What deductibles apply to water, wind, flood, theft, or other key exposures?

The goal is not only to have a policy.

The goal is to make sure the policy matches the real project.

Weather Damage Can Quickly Become a Delay Problem

A covered loss during construction can create a second issue: delay.

For some projects, delay can affect:

financing costs
interest expense
professional fees
inspection timing
rental income
sale closing dates
occupancy deadlines
owner handover
lender requirements
project management costs

This is where soft costs and delay in completion coverage may become important.

A project may have coverage for certain physical damage, but limited or no coverage for the financial impact that follows.

That is a problem many builders only discover when the schedule has already moved.

For larger projects, renovations, infill developments, mixed-use builds, and owner-driven construction, this conversation should happen early.

Renovations Can Create Extra Coverage Questions

Not every Course of Construction project is a clean new build.

Many Ontario projects involve renovations, additions, conversions, repairs, rebuilds, or work on an existing structure.

That can create coverage confusion.

The existing building may be treated differently from the new work. The owner’s property policy may not respond the way the owner expects during active construction. Vacancy, partial occupancy, tenant access, demolition, structural work, hot work, older systems, and lender requirements can all change the insurance conversation.

The key question is:

What exactly is being insured during construction?

For renovations, builders and property owners should confirm whether the existing structure is included, excluded, limited, or insured separately.

Assumptions can be expensive.

Theft and Site Security Still Matter

Weather may be the headline, but theft and vandalism remain major construction-site concerns.

Active sites often contain tools, copper, wiring, appliances, HVAC equipment, lumber, steel, windows, doors, fixtures, generators, and high-value materials waiting to be installed.

The risk increases when materials are delivered early, stored in visible areas, or left unsecured over weekends or holidays.

Builders should review:

fencing
lighting
cameras
locked storage
access control
after-hours procedures
delivery timing
theft deductibles
policy sub-limits

The insurance file should match how the site is actually being secured.

What Builders Should Review Before the Next Project Stage

Course of Construction insurance should be reviewed at the points where project risk changes.

Project Stage	Why It Matters
Before construction starts	Confirm project value, named parties, timeline, materials, and policy structure.
Before the building is watertight	Review water, wind, drainage, temporary protection, and open-envelope exposure.
When major materials arrive	Confirm whether materials are covered on-site, off-site, or in transit.
When the project is delayed	Check policy expiry, extension needs, soft costs, and delay exposure.
When the scope changes	Update insured value, timeline, construction details, and lender or owner requirements.
Before occupancy or handover	Confirm when Course of Construction coverage ends and what permanent insurance must be in place.

A policy that made sense at the start of the project may not fully reflect the risk six months later.

Download the 2026 Course of Construction Insurance Brief

We created After $2.4B in Severe-Weather Losses, Is Your Build Protected? to help builders, developers, contractors, and property owners in Ontario, Alberta, and BC review Course of Construction insurance before the project is exposed.

The brief covers: