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24 Sep, 2020
Recent months have seen various sectors of the construction industry hit by a rapidly hardening insurance market, with premiums increasing 2, 3 or 4 times, cover reduced, restrictions imposed and in worst cases insurance has become unavailable. Everyone from architects & surveyors to contractors and suppliers are under pressure.
After many years of ‘cheap’ insurance the rising costs of claims, various regulatory and legislative changes, falling investment returns, climatic events and coronavirus have forced insurers to take drastic steps to break even. The construction sector had the additional shock of Grenfell Tower, which has created far reaching concerns over high rise buildings, cladding and fire safety, not just in future projects but also in work that was completed many years ago.
Insurance is now a sellers’ market, with underwriters calling the shots, choosing who they insure and in turn setting the rules. Policyholders can limit the effects by demonstrating to underwriters that they are the best in their class and low risk to insure. One of the best ways to do this is to invest in risk management, including health & safety, business continuity and quality management, all of which are available through the ISO system. Insurance companies understand and respect the ISO standards and will be attracted to business that have a culture of continuous improvement giving them an advantage when negotiating premiums, cover and conditions, it might even make the difference between getting insurance and not.