UK and Ireland
Construction workers on site
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How brokers can help their construction customers manage evolving risks

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    John Nicholls, HSB
    John Nicholls - Construction Product Leader, HSB

    The construction industry has undergone rapid changes over the past few years, transitioning from a boom in demand to a more uncertain economic environment. Escalating costs, economic volatility, and a shrinking workforce are now at the forefront of industry challenges. In this dynamic landscape, risk management and insurance play a crucial role in safeguarding the future of construction firms. For brokers, this evolving environment underscores the importance of providing expert guidance and specialist insurance to help clients mitigate risk and prosper in the future.  

    As construction firms navigate these challenges, HSB’s UK Construction Trends industry report highlights the growing need for comprehensive construction insurance. Let’s examine the key challenges shaping the industry today, and explore how brokers can help their customers address these evolving risks.  

    Skilled labour shortage

    One of the most significant hurdles facing the construction industry is the ongoing shortage of skilled labour. Specialist roles in areas like green construction and advanced mechanical systems are particularly hard to fill, placing pressure on project timelines and costs. The labour gap poses several challenges to contractors, including rising wages, delays, and inflated project budgets.  

    As a result, brokers must ensure the scope of insurance policy coverage is adequate in regard to the contract price limit and the contract period limit. Policies should also include an escalation clause that allow for adjustments to the coverage limits to mitigate increased costs associated with construction projects.  

    To support clients in addressing these challenges, brokers need to understand the impact of these risks on clients and advise them of insurance solutions that may support them should they encounter project delays, cost overruns, or contractual disputes.

    Tool theft the growing threat to productivity and profitability

    Power tool

    Tool theft is an increasingly prevalent issue in the construction industry, especially in urban areas where construction sites are more accessible to thieves. The financial impact of tool theft can be substantial, not only due to the cost of replacing stolen equipment but also due to the delays it causes in project timelines. These delays can ripple across the entire project, ultimately impacting profits.  

    In addition to providing the right insurance coverage, brokers can also advise clients on practical security measures to minimise theft risks. This could include recommending GPS and RFID tracking devices for tools and enhanced on-site security systems. To improve theft recovery efforts, all construction small tools and plant equipment should be registered with the CESAR Scheme – the official marking and security scheme of the Construction Equipment Association. CESAR technologies can help to track, trace and locate equipment in the event of it being stolen.  

    By offering guidance on theft protection and loss prevention, brokers can help clients better safeguard their equipment and minimise disruptions to project schedules.

    Technological transformations

    Technological advancements like Building Information Modelling (BIM) have transformed the construction industry, offering real-time, digital representations of projects that enable more effective decision-making, collaboration, and cost management. By providing valuable data-driven insights, BIM presents a unique opportunity to enhance the insurance process and improve risk management strategies associated with large scale and complex projects. 

    Brokers who can articulate how BIM can improve risk mitigation and project outcomes to insurers, will be in a stronger position to recommend the most relevant coverage at the most competitive terms for their clients. 

    The rise of Modern Methods of Construction

    Modern Methods of Construction (MMC), including off-site manufacturing and modular construction, are reshaping the way projects are designed and built. MMC allows for faster construction times, better quality control, and reduced environmental impact. However, it also introduces new risks, such as supply chain disruptions and transportation-related damages. 

    It’s crucial to stay ahead of the unique risks posed by MMC. Traditional insurance policies may not fully address the specific risks associated with off-site manufacturing, transportation, or quality control issues. By collaborating with contractors and wider professionals associated with the project, brokers can gain a deeper understanding of these new risks and develop specialised insurance solutions that align with the specific needs of MMC projects. 

    Partnering for a resilient future

    While the construction industry faces significant challenges, it also presents numerous opportunities for innovation and growth. Brokers are uniquely positioned to advise construction firms on potential hazards ensuring they have the right insurance cover in place to mitigate risks as much as possible, from financial losses due to the fluctuating costs of materials and labour, to the rise in cyber threats due to the digitalisation of construction processes. 

    In an era of constant change, securing a resilient future in construction relies on the expertise of trusted insurance brokers. By providing insightful advice and tailored risk management strategies, brokers can help clients not only survive but thrive in this evolving sector. 

    Industry report
    2025 UK construction trends
    Explore key trends that are reshaping the future of the UK's construction market, and how those trends are impacting construction insurance risks.
    Download report
    Modern buildings
    © Getty Images/Antonio Hugo
    HSB Knowledge Squad Podcast
    Construction theft: contractors' small tools and equipment

    HSB's John Nicholls, Construction Product Leader, and Jamie Talbot, Underwriting Manager, explore the rising impact of small tools and equipment theft in the construction industry, how they affect construction customers’ bottom line and, what preventative measures and industry best practices they can take or follow to mitigate the risk of theft.

    Stream via: Amazon Music | Apple Music | Spotify | YouTube | YouTube Music | Web browser

    Listen now
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    HSB Construction Insurance
    Our comprehensive range of e-trade and non e-trade insurance policies can cover all aspects of commercial, residential, and civil engineering projects.
    Learn more
    Construction site
    © Getty Images
    HSB Knowledge Squad Podcast
    2025 UK construction trends

    HSB's John Nicholls and John Butterworth explore key trends that are reshaping the future of the UK construction market, and how those trends are impacting construction insurance risks.

    Stream via: Amazon Music | Apple Music | Spotify | YouTube | YouTube Music | Web browser

    Listen now
    Modern building
    © Getty Images/Antonio Hugo

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