Installation Floater vs Builders Risk: Which Do You Need?

An installation floater protects one trade contractor's materials and equipment while they are in transit, in storage and at the job site until they are installed. Builders risk protects the entire building under construction, and the materials going into it, for the owner or general contractor for the length of the project. Both are inland marine coverages. The Nationwide Marine Definition groups "Builders' Risks and/or Installation Risks covering interest of owner, seller or contractor" together.^[1] The practical rule: a trade contractor who installs things buys an installation floater, usually on an annual policy, while the owner or general contractor buys builders risk for each project.

This guide is for a California contractor or owner deciding which policy a job needs, or why a contract asks for both. It compares the two, describes who buys each and when a floater is still needed on a job that has builders risk, and lists the programs we use that sell each one. When you're ready, request an inland marine quote for a floater, or request builders risk quotes for a project.

What is the difference between an installation floater and builders risk?

Whose property is covered, and for how long:

	Installation floater	Builders risk
Covers	Materials, fixtures and equipment a contractor will install	The building or structure under construction or renovation, and its materials
Who buys it	The trade contractor doing the installing (HVAC, electrical, plumbing, windows, cabinets)	The owner, general contractor, developer or tenant^[4]
Where	In transit, in storage, and at the job site until installed	At the project site, with extensions for transit and temporary storage^[3]
Term	Usually annual, on the contractor's own policy	The project, often 3 to 12 months^[4]^[3]
Limit	Per job and per location, sized to the largest job's materials	The completed value of the building, or the renovation cost^[3]
Typical cost	A small add-on to a contractor package^[2]	Priced per project. Alchemy's minimum is $400 per policy term^[3]

The 1953 Nationwide Marine Definition described installation risks as covering "machinery and equipment including plumbing, heating, cooling and electrical systems ... while in transit to place of installation and during the period of installation and testing." The 1976 version expanded that to building materials and supplies used in "installation, testing, building, renovating or repairing."^[1]

Who needs an installation floater?

Any contractor who buys materials and carries the risk until they're installed. A window installer with $40,000 of windows in the truck, an HVAC contractor with a rooftop unit sitting at the client's site, or a cabinetmaker with a whole kitchen's worth of cabinetry stored in a garage all have property that general liability doesn't cover and that the owner's policy may not cover yet.

Contractor programs sell floaters as part of a package:

Program	What it offers
RLI Contrac Pac	Installation floater available on both Quickwrite and Package, with tools and equipment, employee tools and non-owned equipment^[5]
VETA (BTIS)	Easy-add package: $5,000 miscellaneous tools, $10,000 installation property and $5,000 miscellaneous property for $100, or $10,000 / $20,000 / $10,000 for $200, $500 deductible^[2]
MGT contractor BOP	Contractors' installation, tools and equipment coverage automatically included, with tools limits from $5,000 to $100,000^[6]
Blitz	Contractors inland marine bundle on its contractor program, and an installation floater enhancement on builders risk^[7]^[4]

Size the limit to the most material you'll have at risk at one time, in transit or at one site, not to your annual volume.

Who needs builders risk?

The owner or general contractor of a construction or renovation project, and usually whoever the lender or contract names. Builders risk covers the structure as it goes up, plus materials on site. Programs publish their limits by project:

Alchemy's national program covers new construction from $150,000 to $5,000,000 per structure and renovation from $10,000 to $1,000,000 per job site, with transit and temporary storage of $10,000 each.^[3]
Blitz writes projects up to $5 million total insured value per location, for owners, general contractors, developers or tenants, on 3, 6, 8, 10 or 12-month terms, and its coverage is "written on Inland Marine forms."^[4]

Our guides to builders risk cost in California and the best builders risk programs cover pricing and markets.

If the project has builders risk, does a subcontractor still need a floater?

Often yes, for three reasons. First, builders risk is usually written on a specific project site, with limited transit and storage extensions, so a sub's materials sitting in its own yard or truck before delivery may not be covered.^[3] Second, the sub may not be listed as an insured under the owner's builders risk policy, so read carefully who the named and additional insureds are. Third, the builders risk deductible or an exclusion may leave the sub's loss uninsured.

Before relying on the builders risk policy, ask the general contractor for its named insureds, deductible and transit and storage limits. If your contract says you remain responsible for your materials until acceptance, carry a floater.

What should I have ready to price either one?

For an installation floater: the types of materials you install, the most you will have at one site and in transit at any one time, how and where your materials are stored, and your annual installation volume.

For builders risk: the project address, construction type, completed value or renovation cost, the existing building's value for a renovation, start date and term, and who the owner, builder and lender are.

Frequently asked questions

Is an installation floater the same as builders risk?

No. Both are inland marine, but a floater covers one contractor's materials until installed, and builders risk covers the whole structure under construction for the owner or builder.^[1]

Is an installation floater inland marine?

Yes. Installation risks are part of the Nationwide Marine Definition, which is why floaters are written on inland marine forms.^[1]

How much does an installation floater cost?

Often a small add-on. BTIS's VETA program sells $10,000 of installation property with $5,000 of tools and $5,000 of other property for $100 a year.^[2]

Can one builders risk policy cover the subcontractors' materials?

It can cover materials at the site that become part of the building, depending on who is insured and the policy's transit and storage limits. Check the policy before relying on it.^[3]

This guide is general information based on the Nationwide Marine Definition and carrier program sheets dated 2023–2026. Your policy's terms control. Menlo Insurance Services (CA license 6020106) is a licensed broker that may earn a commission on a placement. Non-admitted insurers are not backed by the California Insurance Guarantee Association.