The combination of increased losses in recent years and the uncertainty caused by the COVID-19 pandemic - which led to project delays and higher prices for materials such as lumber - are the main culprits behind higher rates for construction insurance. The size of the price increases varies according to a company’s loss history and the type of project it’s completing.
Base pricing of risk has been up about 25%, while other policies have seen 50-100% increases, according to an article published in the Engineering News-Record. Furthermore, the construction insurance market was characterized as one that “remains very difficult, with upward price pressures.” Due to the unstable market conditions, many insurers are unwilling to guarantee pricing for more than 12 months.
However, the news isn’t all negative. One positive trend is professional liability coverage of contractors. Firms with a good loss history are only seeing renewal increases of between 5-10%. Additionally, insurers are typically not attaching any COVID-19 exclusions to the policies.
With rates on the rise, it’s more important than ever to have an independent insurance agency finding the best policies for you. That’s why Ansay & Associates never uses a “one size fits all approach.” Rather, we find the coverage that fits your business best. Call us today to review your current level of coverage and exposure to risk at 1-888-262-6729 or visit us www.ansay.com for more.