Following the soft‑market trajectory that began in late 2023, the UK construction professional indemnity insurance (PII) landscape continued to ease through 2024 and 2025, with insurers expanding capacity and demonstrating increased appetite for well‑managed construction risks. The market may be softening, but insurers’ scrutiny of risk quality and documentation remains unchanged.
Increased insurer appetite, expanding Lloyd’s and MGA capacity, and competitive pricing reshaped conditions for contractors, engineers, architects, and design-and-build firms.
Looking ahead to 2026, we are forecasting renewal rates to be between -5% and -10%.
Insurers’ appetite for construction professional indemnity remains selective but improving, particularly for well-managed risks. While capacity has returned to the market, underwriters continue to scrutinise risk profiles closely, with a strong focus on the scope of services, contract wording, claims history, and risk management frameworks.
Design-only consultancies, project managers, and engineers with limited exposure to high-risk activities are generally viewed more favourably. However, coverage restrictions remain common, including exclusions for certain design responsibilities, fire safety, cladding, and contractual liability. Insurers are increasingly willing to offer broader coverage where insureds can clearly demonstrate strong governance, quality control, and compliance processes.
Many insurers continue to apply exclusions or sub-limits relating to combustible cladding, façade systems, and fire safety design. However, cover is available where underwriters can get detailed disclosure around materials used, professional involvement, sign-off responsibilities, and compliance with current building safety legislation. Insureds involved in remediation, retrospective fire safety assessments, or higher-risk building types should expect additional scrutiny and, in some cases, reduced capacity or narrower terms.
Softening Market and Rate Reduction.
Across the UK PI and construction-related insurance classes, 2025 marked the softest conditions seen in nearly a decade. Rates continued to decline, coverage broadened, and underwriters competed aggressively for quality risks.
In 2026, the London market renewal rates are expected to decrease between 5% to 10%. With the increased capacity in the market, insurers will be looking to grow; however, with the softening rates, they will have to write new business just to stand still, driving even further competitive tensions, which can ultimately lead to reductions of up to 20% for favourable risks.
However, this softening is not uniform across the market. Higher-risk disciplines, fire safety-related exposures, and firms involved in residential or high-rise projects may see less benefit. Overall, while conditions are more favourable than in recent years, underwriting remains cautious, and terms are highly differentiated based on risk quality.
Those with strong risk management practices, clear contractual controls, and a proactive approach to compliance are better positioned to negotiate improved terms. Conversely, firms with complex design exposure, poor claims experience, or limited documentation may still face restricted coverage or higher deductibles.
To help you in this softening market, Willis' ProXS offers contractors and firms across the construction industry with enhanced and cost-effective coverage.
Find out more about the benefits and unique features ProXS has to offer.
