Contractor’s professional liability

The insurance market for contractor’s professional liability was stable throughout most of 2025, with no significant surprises or shifts in capacity. Later in 2025, the market began tightening somewhat, with smaller rate reductions more commonplace.

Over the last 12 months, the contractor’s professional market has hardened ever so slightly. Heading into 2026, the expectation is that well performing accounts will see flat to slight rate increases. As was the case in 2025, there is no expectation of any broad, sweeping restriction in coverage or market push on retentions. Some carriers, however, will continue to evaluate the limits they’re willing to offer for rectification coverage.

Project-specific professional liability coverage continues to be available, though insurers remain attuned to managing their aggregate exposure. Underwriters in 2026 will continue to focus on clients’ operations, their spread of risk in construction vs. design activities, and loss history. The more design work a contractor does, the greater the risk.

Insurers have seen an influx of rectification claims during the past five years but so far are not restricting coverage. The increase in claims frequency is a natural consequence of a larger group of contractors using design-build project delivery and noticing errors during the construction process.

An important consideration for policyholders is the reporting requirements for rectification claims. Generally, awareness of design errors that can be rectified prior to project delivery must be reported to insurers immediately. The trade-off for insurers is paying for rectification during construction to avoid larger liability claims afterward. The adjustment process therefore moves quickly.