Insurance cover crisis intensifies across construction

Grant Prior 3 years ago
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Subcontractors are facing record hikes in Professional Indemnity (PI) insurance as construction’s cover crisis intensifies.

Specialists have been in touch with the Enquirer highlighting premium hikes of more than 400% during negotiations for New Year renewals.

One said: “Our current premium has gone up from £18,000 to over £100,000 – with no claims history, nothing pending and a much larger excess.

“We were only able to obtain a single quote because the market is so tight.”

Trade body the Confederation of Construction Specialists has also highlighted “massive” premium hikes facing its members alongside the onerous demands of main contractors.

CCS General Manager Gerald Kelly said: “The actions of main contractors are not helping the PI insurance problem – in fact, they are making the situation worse.

“Many main contractors have opted to push risk down their supply chain by insisting on ridiculous PI insurance requirements – stipulating £5 -10m PI insurance coverage is becoming the norm.

“The assumption is that subcontractors will cover the main contractor exposure by having adequate PI insurance to do so.

“Main contractors need to understand that just passing their problems down through their supply chain is not the answer as they have the same PI Insurance issues too.

“Moreover, the insurance industry is not working for UK Construction and is having a damaging influence on it.

“The government needs to investigate the insurance industry with the intention to recommend actions to propel the insurance industry to a position where it can support UK Construction and not hinder it.”

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