Regional update
United States and Canada
Builder’s risk
Capacity
The insurance market continued to offer capacity at high overall levels across the US and Canada. In the US, individual insurer participation remained limited, a trend expected to persist as project values rise and reinsurance challenges intensify. In Canada, the continued growth in capacity coupled-with strong growth targets for the domestic insurers have led to oversubscription even for hard to place complex projects.
Insurance focus areas
Insurers generally focused on expanding segments such as data centers and power and energy. In the US, additional growth is expected in construction related to medical facilities, airports, large infrastructure, and educational institutions. In Canada, growth is expected to focus on mining, civil infrastructure and manufacturing. Residential projects generally received less emphasis, necessitating detailed risk management and strong insurer engagement to secure favorable terms.
Defects exclusions
In the US, defect exclusions remained widely available, with LEG3 increasingly replaced by proprietary insurer wordings featuring tighter definitions of damage and defects, higher deductibles, and embedded sublimits.
In Canada, LEG3 coverage was still widely available and used, but aftermath of legal debates over the ‘damage versus defect’ distinction have led many Canadian insurers to insist on including their approved ‘damage’ definition in the policy wording and restrict the LEG 3 coverage offering to 1996 form rather 2006 form.
Pricing and limits
In the second half of 2025, well-managed projects in the US with minimal catastrophe exposure saw rate reductions of 5% to 8%, though insurers remained focused on natural catastrophes and secondary perils such as wildfire and severe convective storms.
With no major industry-wide loss event recorded in 2025, market conditions remained stable.
Limits tightened and deductibles increased for wildfire and convective storm risks in high-hazard areas, and some insurers offered deductible caps. Water damage remained the primary attritional loss driver for standard building construction, prompting insurers to emphasize higher deductibles and the adoption of technology to mitigate risk and loss severity.
Due to availability of sufficient capacity, the pricing remained largely competitive in Canada. However, the deductible minimums have generally been stabilized even after the end of hard-market cycle as result of claims inflation. The pricing for the catastrophe-exposed risks, timer-frame risks and other tougher occupancy classes remained at certain minimum levels given cautious approach from the insurers regarding capacity deployment.
Professional indemnity
United States
US professional indemnity/liability capacity remained strong and stable. Most insurers offered primary limits of US$10 million, with some supporting up to US$25 million on a primary basis. Overall market capacity exceeded US$350 million.
Pricing pressure eased in late 2025. Total program rates increased by 2% in Q4 2025, moderating from a 3.4% increase in the prior quarter. Individual account outcomes varied, driven primarily by claims experience, involvement in high-hazard projects, client service and relationship changes, M&A activity, and project geography.
Insured activity was broad-based, with notable project demand across road and highway infrastructure, digital infrastructure, logistics facilities, refineries, and multi-family housing developments.
Canada
The Canadian market saw a number of new insurer entrants and capacity for project-specific professional liability (PSPL) in excess of US$100 million. Deductibles remained higher than the Canadian market has traditionally seen, though closer to levels seen in US and Australian markets.
Alternative risk transfer (ART) structures grew in popularity as a means of aligning interests and driving collaboration between designers, builders, and consultants. Premiums were generally stable, and rates were flat.
Contractor-controlled professional indemnity (CPPI) also grew in popularity, with insurers expanding their appetite.
Annual PI rates were flat or increased 2% to 5%, driven by new insurer entrants.
There was growing demand for higher limits, with a strong emphasis on ART structures, especially for clients with good loss history.
Single-project professional indemnity rates remained flat or increased by 3% to 6%.
Casualty
In the US, casualty rates were flat or increased flat to 5%, general liability rates were flat to 10% and auto saw increases of 5% to 20%.
These increases were driven by a number of factors, including a rise in nuclear verdicts and third-party funded litigation, as well as broader macroeconomic factors such as inflation and high interest rates.
A steady increase in client-retained risk was observed. Insurers maintained a focus on underwriting, with appetite for moderate-hazard risks with loss histories they view as favorable.