Insurance Program Results
Contractors: Better Pricing
Crittenden Rankings: Contractors Coverage
|
|||||
|
Carrier |
Minimum Premium |
Extent of Coverage |
Notes |
Crittenden’s Customer Service Rating |
|
|
Allianz |
$2,500-$5,000 |
General Liability, Builders Risk |
Highest known limits for builder’s risk. Began underwriting coverage for USI in April and provides coverage for projects of all sizes and types. Primarily focuses on renewable energy. |
5 Stars |
|
|
ACE |
$2,500-$5,000 |
General Liability, Builders Risk, Professional Liability, Pollution Liability |
Writes coverage for all project types except frame construction. Began backing USI’s program in April. |
5 Stars |
|
|
XL Catlin |
$5,000 |
General Liability, Builders Risk, Professional Liability, Pollution Liability |
Remains in middle of builders risk segment, but secures the majority of its business from smaller projects or civil works. |
4 Stars |
|
|
Beazley |
$10,000 |
General Liability, Builders Risk |
Only takes projects with high minimum premium. Focuses on civil engineering and renewable energy. |
3 Stars |
|
|
The Hanover |
None |
General Liability, Builders Risk |
Enhanced coverage forms to offer more comprehensive coverage to meet greater market demand. Works with independent agencies. |
4 Stars |
|
|
Nautilus |
$1,500 |
General Liability, Professional Liability, Pollution Liability |
Recently expanded coverage to all states except Colorado and New York. Has residential appetite from 10 units to 15 units. Works with independent agencies. |
5 Stars |
|
|
Ironshore |
None |
General Liability, Builders Risk |
Increased limits by $15 million to secure premium from larger, more complex projects. Focuses on civil engineering. |
4 Stars |
|
|
Travelers |
None |
General Liability, Pollution Liability, Builders Risk |
Can cover green building recertification expenses through its Construction Pak policy, which most carriers only offer on an optional basis. Focuses on civil works projects. |
4 Stars |
|
|
Berkshire Hathaway |
$5,000 |
General Liability, Builders Risk |
Willing to work with agencies to secure business from smaller projects. Intent upon targeting heavy civil works projects in near future. |
3 Stars |
|
|
RLI Insurance Co. |
None |
General Liability, Builders Riskfr |
Targets large commercial projects or civil works projects through nonadmitted surplus lines insurer Mt. Hawley Insurance Co. |
1 Star |
|
|
Hartford |
None |
Professional Liability, Workers’ Comp, Environmental Coverage |
Primarily focused of providing environmental liability coverage and pollution liability coverage for contractors. |
2 Stars |
|
|
Zurich |
None |
Builders Risk |
Targets high-value frame projects and writes smaller residential and commercial projects as the bulk of its business. |
1 Star |
|
|
Arch |
$5,000 |
Builders Risk |
Only writes residential projects through underwriting manager Victor O. Schinnerer & Co. |
1 Star |
|
|
See the last page of this publication for information on the Crittenden Customer Service Rating. |
|||||
Carriers’ contentment with the overall construction market will foster competitive pricing through next year. This segment stabilized this year following a slump that resulted in rate reductions of up to 30 percent in 2014 due to excess capacity and limited loss activity. This year was marked by an increase in the number of new projects, leading industry insiders to call the outlook for the remainder of 2015 good. Commercial building and single-family housing projects are predicted to increase by 15 percent, while institutional building and multifamily housing projects will increase by 10 percent and public works construction will expand about 5 percent. Construction of electric utilities and manufacturing plants is predicted to drop.
Rates for most coverages will remain flat over the next year with a few exceptions. Pricing for builders risk is expected to remain flat or increase by as much as 10 percent, while excess liability will likely increase no more than 5 percent. The slight overall positive increase will simply cover claims inflation, except in builders risk line, which currently presents an excess of capacity. There also appears to be too much capacity in excess liability, from both primary and surplus-lines insurers that are typically not in the construction marketplace. This is forcing underwriters to become more selective on accounts, even that means offering lower rates.
Carriers focusing on large projects, including civil engineering construction, commercial buildings, public works and renewable energy, won’t make many changes to their programs for the remainder of 2015. Leading writers of general liability and builders risk for large-scale construction projects include Allianz, ACE, Beazley, Hanover, Travelers and Ironshore. Ironshore expects to secure premium from larger projects throughout 2015 and raised its builders risk limits from $35 million to $50 million in May to meet the growing demand for coverage for more complex construction projects. Hanover enhanced its coverage forms in May to offer flexible coverage broad enough to cover construction needs varying from single properties to blanket policies or renovations. Currently, Hanover Builders Risk has one of the broadest coverage forms in the industry. RLI Insurance Co. entered this space in late 2014. Its nonadmitted surplus lines insurer, Mt. Hawley Insurance Co., targets large commercial projects and heavy civil works projects. More established carriers don’t yet consider Mt. Hawley to be competitive in this segment.
W.R. Berkley Corp.’s new Berkley Construction Professional Liability Underwriters will provide professional and pollution liability coverage for contactors. This product will be available on a primary and excess basis. Also, W.R. Berkley subsidiary Nautilus enhanced its general liability product for contractors and expanded its availability to all states except Colorado and New York. The enhanced program includes rate reductions in over 20 contracting classes, an expanded residential appetite that rose from 10 units to 15 units, and excess limits up to $10 million.
Program manager USI Insurance Co. made a splash in the builders risk market with the launch of a Builder’s Risk Program in April. Underwritten by Allianz and ACE, the program is aimed at addressing inconsistencies in pricing and deductibles offered to middle-market owners and contractors. Allianz offers the highest known limits in this segment, up to $260 million, allowing the USI program to cover projects of all sizes. Accounts can negotiate terms and conditions to meet contractual and lender compliance. Premiums can be reduced with the removal of budget markups, as can the program’s accelerated response to claims, which lowers overall claims costs. Expect carriers such as Beazley, Travelers and Ironshore to raise their limits and offer more competitive pricing in late 2015 or early 2016 if USI’s program finds success.
XL, Berkshire Hathaway and Zurich will dominate in writing general liability and builders risk for the small projects market. Berkshire Hathaway is the newest player in this market, having entered in early 2014. It offers limits of up to $100 million and primarily targets smaller civil works projects. Zurich has turned its focus to smaller residential projects for the bulk of its business and expects to see its book grow commensurate with the increase in single-family and multifamily housing projects. Arch Insurance Group also writes residential projects but hasn’t been competitive due to the low limits on its builders risk coverage.
The demand for environmental coverage that emerged during the last five years hasn’t led to widespread availability. Carriers offering this for coverage include ACE, the leading carrier of this specific coverage, as well as XL Catlin, Travelers and The Hartford. The coverage is generally written as a multi-year policy that incorporates regulatory risk and damage to reputations. Contractors face problems dealing with mold found in existing buildings or introduced via new construction when supplies are exposed to rain or moisture before walls are closed or if pipes burst. Most construction contracts now require environmental or pollution liability coverage. While Berkley only provides protective coverages for contractors across non-environmental risks, it could soon dabble in offering environmental coverage as well, since demand is high.
The noticeable lack of experienced and qualified talents at all levels of construction projects with increase carriers’ reliance on risk management programs. The recession that begin in 2007 pushed unemployment in the construction sector to more than 20 percent and the slow recovery led to fewer new hires while the remaining workforce grew older and retired out of the industry. A general fear among carriers is that greater losses will emerge if the construction industry continues to grow rapidly while facing a dearth of experienced workers. USI specializes in risk consulting and assess such risks within its new builder’s risk program. Other carriers take alternative approaches. XL partners with Red Angle, a producer of construction and safety materials in Spanish, to help bridge potential communication gaps by deliverying construction safety lessons to Latino workers, who compose nearly a quarter of all U.S. construction workers, in their native language.
Copyright © 2015 Crittenden Research Inc.
BeazleyOne ENVIRO (Private Enterprise/Small Business)
Administered By: Beazley
Distribution: Direct/Broker
| Industries: |
Architects & Engineers (A&E), Consultants/Consulting Risks, Contractors |
|---|
Carriers: Beazley Insurance Co. Inc.
Coverage: Cyber Liability, Environmental/Pollution Liability, Errors & Omissions (E&O), Professional Liability
Limits: up to $5 million
Builders Risk (Admitted and E&S)
Administered By: Beazley
Distribution: Direct/Broker
| Industries: |
Builders Risk/Home Builders, Contractors, Habitational, Municipalities/Government Bodies |
|---|
Carriers: Beazley Insurance Co. Inc.
Coverage: Builders Risk, Excess, General Liability, Umbrella/Excess
Limits: up to $200 million (Varies by Risk/Location)
Contractor Environmental Coverage
Administered By: Philadelphia Insurance
Distribution: Carrier Direct
| Industries: |
Contractors |
|---|
Carriers: Philadelphia Insurance Co.
Coverage: Contractor's Equipment, Contractual Liability, Excess, General Liability, Umbrella/Excess, Workers' Compensation
Limits: $500kk - $25 Million
Contractor Environmental Coverage (CEC)
Administered By: Philadelphia Insurance
Distribution: Carrier Direct
| Industries: |
Contractors |
|---|
Carriers: Philadelphia Insurance Co.
Coverage: Contractor's Equipment, Contractual Liability, Environmental/Pollution Liability
Limits: up to $25,000,000 (per occurrence/multiples available in the aggregate)
Restoration Contractors
Administered By: Philadelphia Insurance
Distribution: Carrier Direct
| Industries: |
Contractors |
|---|
Carriers: Philadelphia Insurance Co.
Coverage: Crime, Environmental/Pollution Liability, Fidelity, General Liability, Property
Limits: up to $1,000,000/3,000,000 (General liability - $1,000,000 per occurrence/$3,000,000 aggregate.)
Architects & Engineers/Design-Build/Construction Prof Liability
Administered By: Target Professional Programs
Distribution: MGA
| Industries: |
Architects & Engineers (A&E), Civil Engineering/Surveyors, Contractors, Environmental Consultants , Interior Designers, Landscape Design/Landscaping/Lawn Service |
|---|
Carriers: Underwriters at Lloyd's
Coverage: Employment Practices Liability (EPL), Professional Liability
Limits: $2 Million - $10 Million ((Tier Two)), up to - $3 million ((Tier One) Firms with revenues between $50,000 and $2 million. Including Excess limits, up to 25% premium discount for accounts with 5 year claim-free histories. )
Property Preservationists/Mortgage Field Representatives
Administered By: Hanover Insurance Group
Distribution: Carrier Direct
| Industries: |
Contractors, Real Estate Managers, Small Businesses |
|---|
Carriers: Hanover Insurance Group Inc.
Coverage: Bodily/Personal Injury, Business Owners Policy (BOP), Errors & Omissions (E&O), General Liability
Limits: up to $10,000,000
Acuity Package Policy Drywall Contractors
Administered By: Acuity
Distribution: Carrier Direct
| Industries: |
Contractors, Workers Compensation |
|---|
Carriers: ACUITY
Coverage: Commercial Auto, Commercial Property, General Liability, Inland Marine, Workers' Compensation
Limits: up to $1 million (Primary Casualty), up to $14 million (Excess Liability), up to $35 million (Property)
Acuity Package Policy Electricians
Administered By: Acuity
Distribution: Carrier Direct
| Industries: |
Contractors, Workers Compensation |
|---|
Carriers: ACUITY
Coverage: Commercial Auto, General Liability, Inland Marine, Property, Workers' Compensation
Limits: up to $1 million (Primary Casualty), up to $14 million (Excess Liability ), up to $35 million (Property)
Builder's Risk (Wood Frame Construction)
Administered By: Ironshore
Distribution: Direct/Broker
| Industries: |
Builders Risk/Home Builders, Contractors |
|---|
Carriers: Ironshore Inc.
Coverage: Builders Risk
Limits: up to $15 million
Contractors Elite
Administered By: Blue River Underwriters
Distribution: Program Administrator
| Industries: |
Builders Risk/Home Builders, Contractors, Workers Compensation |
|---|
Carriers: Zurich
Coverage: Commercial Auto, Crime, Excess, General Liability, Inland Marine, Property, Umbrella/Excess, Workers' Compensation
Limits: up to $2 Million (Liability ($1 Million per occurence/$2 Million aggergate) - Products & Complete Operations)
Contractors Pollution Liability
Administered By: Rockhill Insurance Group
Distribution: Carrier Direct
| Industries: |
Artisan & Trade Contractors, Contractors, Demolition Risks, Environmental Consultants |
|---|
Carriers: Rockhill Insurance Co., State Auto Insurance Cos.
Coverage: Environmental/Pollution Liability, Property Damage
Limits: up to $10 million (Excess), up to $11 million (Pollution Liability), up to $6 million (General Liability)
Demolition Elite
Administered By: Blue River Underwriters
Distribution: Program Administrator
| Industries: |
Artisan & Trade Contractors, Builders Risk/Home Builders, Contractors, Demolition Risks |
|---|
Carriers: AmTrust Group
Coverage: Commercial Auto, Crime, Excess, General Liability, Inland Marine, Property, Umbrella/Excess
Limits: up to $5 million (Excess), up to $1 million/$2 million (General Liability)
Enterprise PrivaProtector 9.0
Administered By: Ironshore
Distribution: Direct/Broker
| Industries: |
Consultants/Consulting Risks, Contractors, Financial Institutions, Healthcare Systems, Hospitality (Hotels/Motels), Manufacturers/Manufacturing Risks, Public Entities, Retail, Technology Risks |
|---|
Carriers: Ironshore Inc.
Coverage: Business Income/Extra Expense, Cyber Liability, Data Security, Media Liability, Network Security Liability, Privacy Liability/Notification Expense, Regulatory Liability
Limits: up to $5 million
Environmental Liability
Administered By: Rockhill Insurance Group
Distribution: Carrier Direct
| Industries: |
Art Galleries/Fine Art/Museums/Antique Dealers, Artisan & Trade Contractors, Colleges & Universities, Consultants/Consulting Risks, Contractors, Environmental Consultants , Farm/Ranch/Agribusiness, Healthcare Systems, Hospitals, Laboratories, Manufacturers/Manufacturing Risks, Mercantile, Museums, Private/Charter Schools, Residential Real Estate (Directors/Managers), Schools, Schools (Adult Education), Sports Facilities, Trucking, Warehouses, Waste/Recycling Services |
|---|
Carriers: Rockhill Insurance Co.
Coverage: Environmental/Pollution Liability, Excess, General Liability, Professional Liability, Umbrella/Excess
Limits: up to $11 million ((Total Combined Capacity)), up to $10 million ((Excess)), $1 million - $10 million ((Primary))
Excess Casualty
Administered By: Rockhill Insurance Group
Distribution: Carrier Direct
| Industries: |
Builders Risk/Home Builders, Commercial Real Estate (Industrial), Commercial Real Estate (Office), Commercial Real Estate (Retail), Contractors, Manufacturers/Manufacturing Risks, Mercantile, Restaurants, Trucking, Trucking (Hazmat), Trucking (Local/Intermediate), Trucking (Moving/Storage), Warehouses |
|---|
Carriers: Rockhill Insurance Co.
Coverage: Excess, Umbrella/Excess
Limits: $1,000 - $2,500 (Minimum Premium), up to $5 million (Lead), up to $10 million (Excess Capacity)
Fire Sprinkler & Fire Equipment Contractors
Administered By: Blue River Underwriters
Distribution: Program Administrator
| Industries: |
Builders Risk/Home Builders, Contractors |
|---|
Carriers: Zurich
Coverage: Commercial Auto, Crime, Errors & Omissions (E&O), Excess, General Liability, Inland Marine, Umbrella/Excess
Limits: up to $2 Million (CSL ($1 Million occurrence/ $2 Million aggregate))
General Liability
Administered By: Rockhill Insurance Group
Distribution: Carrier Direct
| Industries: |
Builders Risk/Home Builders, Commercial Real Estate Manager/Director, Contractors, Directors & Officers (D&O), Equipment Rentals, Hospitality (Hotels/Motels), Manufacturers/Manufacturing Risks, Rentals (Equipment), Residential Real Estate (Directors/Managers), Retail, Warehouses |
|---|
Carriers: Rockhill Insurance Co.
Coverage: Directors & Officers (D&O), General Liability
Limits: $1 million - $2 million
Greenscape Insurance
Administered By: Blue River Underwriters
Distribution: Program Administrator
| Industries: |
Commercial Auto, Contractors |
|---|
Carriers: Zurich
Coverage: Crime, Excess, General Liability, Inland Marine, Property, Umbrella/Excess
Limits: up to $5 Million (Excess ), up to $2 Million (Liability ($1 Million per occurrence/ $2 Million Aggregate) )
Partially Completed & Completed Projects
Administered By: Ironshore
Distribution: Direct/Broker
| Industries: |
Builders Risk/Home Builders, Contractors, Real Estate Owners |
|---|
Carriers: Ironshore Inc.
Coverage: Construction/Builders Risk, Premises Liability, Products & Complete Operations Liability
Limits: up to $10 million (Residential Projects), up to $25 million (Commercial Projects)