In terms of risk management, which type of insurance excludes coverage for wear and tear?

Builder's risk insurance specifically covers buildings under construction, including materials and fixtures intended for the building, but it does not cover losses due to wear and tear. This type of insurance is designed to protect against specific risks associated with construction projects, such as fire, theft, and vandalism, rather than the gradual deterioration that occurs over time through normal use.

In contrast, general liability insurance primarily covers bodily injury or property damage caused to third parties, while homeowner's insurance provides coverage for a home and personal property against various risks, usually including incidents that can result in wear and tear, albeit under specific conditions. Property insurance encompasses a wider range of protections for real estate and personal property against loss or damage, typically including issues associated with age and usage. Therefore, the defining characteristic of builder's risk insurance is its exclusion of coverage for wear and tear, focusing instead on more immediate perils that might face a structure during active construction.