Regional update
Europe
Western Europe
Macroeconomic landscape
Countries across Western Europe were affected by inflation, political instability, and supply chain disruptions, leading to increased costs, project delays, and cautious investment.
- Spain: Inflationary pressures increased the costs of materials and labor, causing unexpected cost overruns, budget revisions, and sometimes project scope reductions.
- France: Government instability impacted real estate development, with banks generally conservative due to high loan rates. Renewable energy projects continued to grow strongly, supported by government-backed plans.
- Germany: Residential construction remained subdued due to generally high construction costs and interest rates. Commercial and public construction projects were stable, with investment directed toward data centers, medical facilities, and infrastructure. Some projects experienced delays or gap phases.
Insurance landscape
Across Western Europe, insurers demonstrated cautious but steady risk appetite. Coverage remained generally available, with some tightening on deductibles and contract terms.
- Spain: Excess capacity was evident in the insurance market, especially in property, liability, and construction. Competitive rates and solid risk appetite were noted, particularly in civil works and digital infrastructure. Risk scrutiny increased, especially around contract terms, design exposure, ground conditions, and loss history.
- France: No new market entrants emerged; risk appetites remained unchanged and rates were stable. There was generally no reduction in coverage; limits held steady while deductibles increased.
- Germany: Capacity for combined project insurance increased as insurers re-entered the market. Premiums were flat or increased by 5%. Insurers were cautious regarding limits due to rising construction costs.
Construction all risks (CAR)
Construction all risks coverage was generally available. LEG3 coverage was offered, but often with sub-limits, particularly in Spain and France. Capacity remained available, though insurers were cautious on limits and contract terms due to rising costs.
- Spain: There was strong insurer appetite for CAR/delay in start-up (DSU), with capacity available and no additional restrictions on coverage. For power projects, LEG3 sub-limits applied, though not for civil works.
- France: There was generally no reduction in coverage; limits were stable and deductibles slightly increased. The French market continued to offer LEG3 and full maintenance coverage.
- Germany: Capacity for combined project insurance increased as insurers re-entered the market. Premiums were flat or increased by 5%. Insurers were cautious regarding limits due to rising construction costs.
Southern Europe
Macroeconomic landscape
Renewable energy projects faced delays due to supply chain disruptions, national grid unavailability for testing, and licensing delays. The construction market in Cyprus, particularly in Limassol, continued to boom, though large infrastructure projects were affected by geopolitical factors and complex government procedures.
In Türkiye, inflation and geopolitical tensions caused delays in government projects due to late contractor payments, leading many contractors to redirect their focus to projects outside the country.
Insurer landscape
In Greece, new entrants from Continental Europe and the London market increased the level of competition, leading to rate decreases. Competition levels were similar in Türkiye, and capacity increased substantially. Rates began to decrease in the second half of 2025. The insurance market in Cyprus remained stable.
Product overview
Across Greece, Cyprus, and Türkiye, core construction insurance, such as CAR, and related liability sections were generally obtainable, though insurers varied in their treatment of defects cover, natural catastrophe exposures, limits, and deductibles.
- In Greece, capacity was available for standard projects, though underwriting was increasingly shaped by exposure management rather than broad “all-in” limits. LEG3 was available locally but typically sub-limited (around US$1 million), and insurers introduced sub-limits for natural catastrophe (NatCat) coverage, which could reduce effective earthquake and NatCat protection within the overall policy limit.
- In Cyprus, coverage was widely available for typical risks, though deductibles varied significantly by project type, location, and method of work. LEG3 was rarely offered in the local market.
- In Türkiye, coverage availability was generally strong, with active reinsurance support. For complex risks, limits and deductibles were broadly in line with international markets, while simpler superstructure projects often secured lower deductibles. LEG3 was generally not offered.
Nordics/Baltics
Macroeconomic landscape
The region experienced the effects of inflationary pressures, geopolitical tensions, supply chain disruptions, currency fluctuations, and changes in energy policy. These factors led to project delays, cost increases, investment postponements, and cautious financing, resulting in companies adopting various risk management strategies to mitigate the impacts.
Insurance landscape
Several new insurers entered the market, increasing competition, particularly in Denmark, Norway, and Lithuania. Risk appetite was generally stable or slightly decreased for large projects, rates were mostly stable with some modest increases, and risk scrutiny intensified in areas such as energy storage and drone-related risks.
Construction all risks (CAR)
Coverage was generally available across the Nordics and Baltics with ample capacity depending on project size, though deductibles and LEG3 limits varied by country.
Compulsory CAR insurance in Lithuania limited capacity and coverage availability. Lithuanian CAR insurance wording is based on LEG2, with strict deductible requirements. The local market does not generally offer LEG3 or higher sub-limits without reinsurer capacity.
Central and Eastern Europe (CEE)
Macroeconomic landscape
Macroeconomic factors have affected clients across the CEE region. These include inflation, geopolitical tensions (notably related to the Russia-Ukraine conflict), supply chain issues, political unrest, and economic downturns. These factors continue to cause project delays, increased costs, budget pressures, and cautious investment and construction activity.
Insurance landscape
Across Serbia, Slovenia, Croatia, and Romania, the construction insurance market remained broadly stable, with no new insurers entering the market and generally steady capacity and appetite among incumbent insurers.
Croatia was similarly unchanged in terms of insurers and appetite, with stable rates. Insurers in Croatia continued to apply more restrictive terms to high-exposure activities — notably tunnelling, mining, and wet works — typically through exclusions or materially higher pricing.
In Romania, insurer participation remained stable, but underwriting was increasingly handled on a project-by-project basis, reducing consistency and predictability in underwriting and commercial terms.
Construction all risks (CAR)
Across Central and Eastern Europe, LEG3 availability is mixed. In Serbia, construction coverage was generally obtainable on moderate deductibles, with LEG3 available but typically offered on a sub-limited basis. In Slovenia, LEG3 remained difficult to secure and was not routinely offered by insurers. In Croatia, capacity was sufficient for standard project needs and LEG3 was seldom requested or required. By contrast, in Romania, LEG3 was readily available for most projects.