Regional update
United Kingdom
Insurance update
UK construction insurance capacity was ample, supported by both newer participants and larger deployed lines from incumbent insurers. While the capacity withdrawn since 2020 is not likely to be replaced fully — particularly for larger and technically complex risks — overall conditions remained competitive and favorable for insureds. Pricing momentum trended downward.
Insurers offered broader coverage, higher limits, more flexible underwriting, and fewer or more tailored exclusions as key differentiators. Improvements were most evident for insureds that could evidence strong controls around fire, water damage, and subcontractor governance, while technically complex or loss-impacted risks typically faced tighter terms.
Despite a favorable outlook, market conditions could be disrupted by external factors, including macroeconomic uncertainty, trade tariffs, geopolitical events, supply chain disruptions, and labor shortages. These factors continue to have the potential to drive delays, cost escalation, and quality issues, which could localize tightening in specific project types, geographies, or perils.
Product update
Retail
The UK retail construction insurance market showed favorable conditions for standard projects, with construction all risks and third-party liability cover widely available from a range of domestic and London-market insurers. For well-managed retail schemes with clear contract structures and established contractors, capacity was generally available and underwriting was typically pragmatic, though insurers continued to focus closely on fire protection, hot works controls, and contractor risk management.
There was an increased willingness among some insurers to consider delay-in-start-up (DSU) where projects demonstrated robust programs, realistic critical paths, and strong supply chain oversight. DSU remained more selectively underwritten than core CAR/liability, but broader wordings and more comprehensive structures were increasingly achievable for stronger risk profiles.
Reflecting rising construction costs and inflation, there was a continued upward movement in policy limits to keep declared values and reinstatement costs aligned with current build prices. Deductibles generally increased as insurers sought to manage higher claims frequency and severity, with particular emphasis on escape of water and resultant damage.
Wholesale
In the UK wholesale (London) market for international construction clients, core construction all risks (CAR)/erection all risks (EAR) and third-party liability capacity remained strong, with insurers generally willing to support multinational programs, complex contract structures, and layered placements where local markets were not offering the required breadth or limits.
Broader coverage, higher limits, and more flexible terms were often available, particularly for well-governed risks with clear project information, disciplined contractor selection, and demonstrable controls around fire, water damage, and quality assurance.
Natural catastrophe (NatCat) limits remained a primary underwriting focus due to portfolio aggregation and modeled loss volatility, even during a relatively benign NatCat period. Greater NatCat limit deployment is anticipated over time, with insurers continuing to manage NatCat exposure through higher NatCat deductibles in the interim.