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Builders’ risk underwriting is no longer just price exposure, but is shaping the way construction projects are executed as insurers tighten terms and drive loss prevention responsibility deeper into the workplace.
Higher deductibles and heightened scrutiny of weather- and water-related losses are pushing owners and contractors to manage construction risk sooner and more deliberately, reshaping long-held assumptions about what insurance will absorb and what the jobsite must prevent.
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Builder risk pricing and terms remain highly differentiated by project profile, with complex, high-value and catastrophe-exposed projects continuing to face pressure on deductibles, extensions and coverage terms, according to recent broker and underwriter market updates. While general rate increases have moderated in some lower-risk segments, insurers remain cautious on projects where a single loss can quickly become material.
Recent surveys of brokers show that project-specific builders’ risk policies tied to greater exposure to natural catastrophes continue to experience rate increases in the low single digits, even as capacity selectively returns elsewhere. Insurers are also demanding more detailed submissions and earlier commitment as a condition of coverage, indicating that insurance is no longer a bottom-line consideration, but an operational force that influences how projects are planned and executed.
This pressure is not uniform. Insurers apply stricter builders’ risk terms to coastal and catastrophe-exposed markets, where losses from wind, flooding and severe storms are more acute, while many inland markets face comparatively lighter rates and fewer restrictions, according to broker and underwriter analyses. While coastal markets often feel these pressures first, brokers say similar underwriting scrutiny is increasingly appearing in large, high-value projects across the country.
Insurers are also differentiating risk by project type, according to broker surveys published by Willis Towers Watson. The based in London surveys of the consulting company show that project-specific builders’ risk policies, which are commonly used on large towers, data centers and other high-value projects, face higher and more volatile prices than master programs, with rate increases of 5% to 15% for projects exposed to natural catastrophe risk.
This change shows not only in the premiums, but also in the practice of daily construction.
From subscription pressure to workplace behavior
Carlos Casal, Mast Capital’s executive vice president of construction, said the increase in deductibles has changed the way owners assess the risk of large projects, especially in climate-exposed markets.
Mast Capital is a Miami-based real estate developer focused on high-rise residential and mixed-use projects in South Florida and other coastal markets, where wind, water and calendar risk play an outsized role in construction insurance. The company has developed and delivered multiple luxury condominium towers and is progressing several large-scale projects in dense, weather-exposed urban environments.
“At some point, the deductible becomes large enough to effectively insure you against the first loss,” Casal said. “When this happens, preventing loss matters more than how good your claim recovery process is.”
Casal said insurers are increasingly focusing on water damage, site conditions and schedule discipline, areas that were historically treated as construction management issues rather than underwriting inputs.
“The conversation with insurers has changed,” he said. “They want to understand what controls are actually in place in the workplace, not just what’s written in the policy.”
The comments of the insurers echo this assessment. Recent construction insurance analysis has identified water damage and severe convective storms as persistent loss drivers in builders’ risk, leading to increased scrutiny of water damage mitigation plans and wider use of higher deductibles for risk sharing. Insurers have also noted a growing concentration of value in large projects, such as data centers, hospitals and high-rise towers, where losses can mount quickly.
For owners and contractors, this environment is accelerating a shift toward managing risk during construction rather than relying on insurance recovery after the fact.
One manifestation of this change is the increasing use of sensor-based monitoring and automated controls to detect and respond to water leaks, cure anomalies and environmental conditions before they escalate.
Toronto-based Brickeye operates in this space, providing sensor-based monitoring and automated closing systems designed to reduce workplace risk. The company says its systems are increasingly discussed during builders’ risk underwriting, as insurers ask owners and contractors to document how water and environmental risks are being actively controlled during construction.
Brickeye raised $10 million in a Series B funding round in January, reflecting growing investor interest in technologies aimed at reducing exposure during construction as insurers tighten builder risk terms.
“What we’re seeing is that insurers are no longer satisfied with blanket statements about risk management,” said Tim Angus, co-founder and CEO of Brickeye. “They want to understand what controls are actually in place in the workplace and how losses are being prevented in real time.”
For some contractors, insurance economics, not technological enthusiasm, has been the catalyst.
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Blaik Ross, executive vice president of Beauchamp Construction, said his company initially adopted control tools to reduce water loss and downtime, but later took a stake in Brickeye after seeing how documented risk controls affected underwriting discussions.
Beauchamp is a general contractor operating on the East Coast of South Florida, with a portfolio that spans high-rise residential, commercial and coastal complex projects, placing it squarely in markets where water damage and weather-related losses have become increasingly consequential. The company’s work has positioned it squarely in the path of increased builders’ risk deductibles and tighter underwriting reviews.
“Water losses used to be treated as a cost of doing business,” Ross said. “But when deductibles climb into six figures, that mentality stops working.”
Ross noted that insurers are increasingly asking how risks are managed in real time, not just how they will be reported after a loss.
“Being able to show what controls are there, and when they’re active, changes the conversation,” he said. “It’s not theoretical anymore.”
Casal said that Mast Capital has deployed risk control and mitigation tools in multiple high-rise projects, not as a technological experiment but as a response to the reality of the insurance market.
“It’s not about gadgets,” Casal said. “It’s about discipline. The insurance market is forcing better behavior and the owners are pushing that discipline through the project team.”
For homeowners and contractors navigating higher deductibles and smaller margins for error, that change is already underway.
“Risk management used to start with the claim,” Casal said. “Now it starts with how the project is actually executed.”
