Soft costs include architectural, engineering, financing, and legal fees, and other pre- and post-construction expenses.
Some soft costs may be incurred in the repair of a covered loss before the anticipated completion date is reached.
Rather, they are commonly perceived to entail non-construction costs such as taxes, marketing expenses, interest payments, and finance charges.
[2] In recent years, a solution to the problem has emerged in the form of Delay in Opening coverage which can be provided in Builder's Risk Insurance.
With its popularity increasing in recent years, some insurers automatically include soft costs coverage, which can be activated by designating the limit on policy declarations.
For this reason, it is important to understand that soft costs can refer to unforeseen construction costs (lost screws, damaged equipment), physical labor (task takes longer than expected, losing a key team member), or time wasted on strategy implementation (taking too long to decide a course of action).