Demand for professional indemnity insurance in Asia, Australia grows: Aon

However, insurers are cautious about high-risk developments such as renewable energy.

The professional indemnity (PI) insurance market across Asia and Australia is diverging, with soft pricing for low-risk projects and continued pressure on premiums for complex risks due to limited capacity, Aon said.

In Asia, domestic residential and onshore projects benefit from stable or falling rates, according to Aon’s 2025 Global Construction Insurance and Surety Market Report.

However, insurers are cautious about high-risk developments such as renewable energy, gas pipelines, coal plants, subsea cables, and large-scale infrastructure. 

Demand for PI cover is growing, but underwriting is stricter and slower, particularly for projects with ESG concerns. 

Few insurers are willing to lead these placements, resulting in high premiums and limited capacity. Policy terms rarely exceed 10 years, and extensions after inception are difficult to obtain.

Coverage terms for straightforward projects remain steady, with optional extensions available at an added premium. 

These are harder to secure for high-risk placements. Deductibles and retentions are largely unchanged.

In Australia, the PI market is softening. Rates are falling for non-challenged risks and flat for more difficult ones. 

Despite improving capacity, project-specific PI pricing remains high due to loss history and tight availability. Insurers are now deploying more capacity and restructuring programs for better outcomes. 

Whilst cyber exclusions remain, some insurers are easing restrictions, offering better coordination with standalone cyber policies.

Underwriting scrutiny is increasing across professions and high-risk projects. Quality submissions and strong risk management are key. 

Some insurers are again open to loss mitigation and consequential loss extensions, depending on risk profile. 

Competition is rising as new and existing insurers expand their appetite, particularly in Australia.