Business Costs
Construction Insurance Premiums Continue to Climb in 2024
Heavy claims can drive up the cost of insurance.
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Construction insurance premiums of all kinds rose 4.6% in the first quarter of 2024, according to a midyear market report by the Council of Independent Insurance Agents & Brokers. The data was published by broker Woodruff Sawyer in a report on insurance costs made available on the JDSupra legal website.
The complexities of the various coverages, limits and exclusions are spelled out in detail. Carriers offering coverage of property, equipment and builders' risk are struggling to keep up with "growing project sizes due to rising labor and material costs," the report states, which means shorter terms and tighter sublimits in some cases.
With the exception of workers' compensation, where no or very low premium increases were seen for the first half of 2024, all other forms of coverage saw premium increases. Auto liability insurance, up 8% to 18%, and excess liability insurance, rising 5% to 12%, posted the largest first half increases.
The Council of Independent Insurance Agents & Brokers is a Washington, D.C.-based association that publishes much data on insurance premiums, exclusions, limits and market conditions.
Some of the industry data is consistent with other survey data released by the council in May that covered business insurance of all types in the first quarter of 2024.
Commercial auto premiums increased by an average of 9.8%, up from 7.3% over the previous quarter, the council reported at the time. Vehicle repair cost inflation, the rise in nuclear verdicts and a shortage of truck drivers that is making accidents more likely as employers "lower applicant standards" for drivers, are pushing premiums higher, the council report stated.
Commercial property premiums also climbed an average of 10.1% in the first quarter.
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