Course of Construction Insurance in Canada: Why Brokers Need a More Strategic Approach 

By Jackie Clark, VP, Commercial Insurance & GameDay, Excess Underwriting  

For many years, Course of Construction (COC) insurance, often referred to as Builder’s Risk Insurance, was viewed as a relatively straightforward component of a construction project. Obtain project values, secure coverage, issue the policy, and move on. 

Today’s construction environment tells a different story. 

Across Canada, developers, general contractors, lenders, and project owners are operating in an environment shaped by escalating project costs, supply chain volatility, labour shortages, and increasingly severe weather events. As these challenges continue to impact construction projects from Vancouver to Halifax, brokers have an opportunity to provide far greater value than simply facilitating coverage placement. 

The conversation around Course of Construction Insurance in Canada is evolving from insurance procurement to strategic risk management. 

Construction costs are moving faster than insurance reviews 

One of the most significant trends affecting Canadian construction projects is the growing gap between original project valuations and actual replacement costs. Many projects are budgeted months before work begins, and in some cases, before key materials have been sourced. By the time construction is underway, inflationary pressures, engineering modifications, and procurement challenges can significantly alter the project’s total value. Yet many insurance placements continue to rely on assumptions established at the planning stage. This creates an important conversation for brokers. 

When project values are not reviewed throughout the construction lifecycle, businesses may discover coverage gaps only after a loss occurs. Whether the project involves a commercial building in Toronto, a manufacturing expansion in Ontario, or a mixed-use development in Alberta, maintaining accurate values should be a core part of any construction risk management strategy. 

Soft costs, additional financing expenses, interest charges, professional fees, and Delay in Start-Up (DSU) exposures can significantly exceed the direct property damage itself. Developers may face postponed occupancy dates, delayed revenue generation, or contractual obligations tied to project completion milestones. 

The most effective brokers are helping clients revisit assumptions throughout the project, rather than treating valuation as a one-time exercise. 

Extreme weather is reshaping construction risk across Canada 

If there is one factor that has fundamentally changed the construction insurance landscape, it is weather. Severe rainfall events, flooding, windstorms, hail, wildfires, and seasonal extremes are disrupting construction schedules across the country. 

Underwriters are placing increasing emphasis on catastrophe-exposed projects, particularly those located in flood-prone, wildfire-prone, or severe hail regions. Site-specific risk mitigation strategies, emergency response planning, water management controls, and contingency measures are becoming increasingly important parts of the underwriting process. 

Many construction clients still focus primarily on the physical damage component of weather-related losses. However, the larger financial impact is often the resulting project delay. Every delayed milestone can create additional financing costs, labour scheduling challenges, contractual penalties, and occupancy delays. 

For insurance brokers, the question is no longer whether a project may experience disruption. The question is how prepared the project is to recover when that disruption occurs. As climate-related events continue to increase in frequency and severity, brokers who understand these exposures are becoming valuable strategic partners to construction clients. 

Construction projects have never been more complex 

The modern Canadian construction project looks very different than it did even a decade ago. 

Today’s projects increasingly rely on specialized materials, prefabricated building components, modular construction techniques, advanced mechanical systems, and global supply chains. The growing adoption of mass timber, Cross-Laminated Timber (CLT), and other innovative construction methods is also creating new considerations for project stakeholders and insurers alike. 

At the same time, owners and lenders are demanding greater certainty around project completion. 

This growing complexity means brokers need to understand more than just policy wordings. They need insight into procurement strategies, project sequencing, critical path dependencies, and emerging risk factors. Understanding how a project is built is becoming just as important as understanding how it is insured. 

Why construction brokers are becoming risk advisors 

The strongest construction brokers today are distinguished by the quality of their risk conversations. 

They are helping clients identify vulnerabilities before a claim occurs by asking questions such as: 

• Have project values been reviewed recently? 

• What contingency plans exist for weather-related delays? 

• Are supply chain exposures adequately understood? 

• How could project extensions impact coverage requirements? 

• Have contractual obligations changed since construction began? 

These discussions move the relationship beyond insurance placement and position brokers as trusted advisors. 

For construction firms facing increased project uncertainty, that expertise has never been more valuable. 

A competitive advantage for brokers 

The Canadian construction market remains active despite ongoing challenges. 

Infrastructure projects, commercial developments, industrial expansions, and residential construction continue to create opportunities for brokers who specialize in construction insurance in Canada. 

Those opportunities, however, increasingly favour brokers who understand risk beyond the policy itself. 

Course of Construction insurance remains a critical safeguard, but today’s environment requires a broader perspective that includes project economics, operational resilience, and evolving environmental risks. 

The brokers who embrace this shift will be better positioned to strengthen client relationships, differentiate themselves in the marketplace, and deliver greater long-term value. 

At Excess Underwriting, we continue to work closely with broker partners across Canada to support construction projects through specialized underwriting expertise and innovative solutions designed for the realities of today’s marketplace.

Contact your Excess Underwriting representative today to learn more.