Why it matters: The US construction liability market is diverging sharply from broader GL trends. Residential construction — condos, townhomes, and high-end developments — is a particularly distressed segment, facing tightening capacity, rising excess rates, and increasingly selective underwriting. Insurers are responding with higher retentions, narrower terms, project-specific underwriting requirements, and in some states, outright declinations of residential risks.
The captive opportunity: As traditional market solutions become less viable, captives offer construction firms cost stabilization, improved claims oversight, greater control over long-tail exposures, and access to reinsurance and structured capital solutions. Protected cell facilities — like the one Captives.Insure is developing — bridge the gap between group captives and standalone single-parent captives, lowering capital and administrative barriers while letting each participant retain its own risk independently.
Key quote: "Delegated underwriting authority is not granted lightly — we have to demonstrate capability. The challenges that exist stem from a lack of understanding among all parties about the risk, how to price it appropriately, and how it fits within the value chain." — Reznicek, Captives.Insure
SUBMIT A RISK