Construction insurance rises amidst $38.5b market strain

Excess cover increased 8% to 15% with steeper moves on riskier builds.

The global construction insurance market is valued at $38.5b, driven by a mix of stable rates in some sectors and double-digit increases in others. 

Whilst workers’ compensation rates remain between flat and 3%, auto liability premiums have jumped 8% to 20%. 

Excess liability costs are also rising, with standard increases of 8% to 15% and hikes exceeding 20% for high-risk projects.

Monthly general liability costs vary significantly by trade. Roofers face the highest average premiums at $267, followed by general contractors at $142 and excavation firms at $127. 

Conversely, low-risk trades like locksmiths average $42 per month.

Safety and liability settlements continue to impact industry costs. Total annual construction injuries and fatalities cost $11.5b, with fatal claims averaging $1.39m each. 

Small firms with fewer than 20 employees account for 67.2% of these fatalities. In the professional liability sector, Directors & Officers settlement averages have reached $118,500, whilst Employment Practices Liability premiums have risen 6.7%.

In response to these costs, insurers are increasingly favouring technology and sustainability. Premium discounts are now available for high ESG scores and the use of IoT sensors. 

The construction drone market has reached $4.3b, and wearable technology has helped reduce near-miss incidents by 25%.

Additionally, the construction cybersecurity market is projected to grow to $18.41b by 2030.