Residential
Spending on residential construction rose steeply during 2025, but it appears set to cool in 2026. Residential construction starts are forecast to fall for single-family homes, though multifamily is expected to continue at a robust pace.
BUILDER’S RISK
The builder’s risk market for residential construction is softening. More carriers are entering the space, with appetites to underwrite a variety of projects, from single-family homes to multifamily high-rises. This applies to both woodframe and noncombustible construction types.
Conditions are especially favorable for single-family projects. In addition to renewing programs with lower rates, many buyers are able to secure lower deductibles than in prior years.
London underwriters tend to view woodframe as a class of business that is better managed than it was five years ago. This has led to a significant increase in appetite.
Crime scores and wildfire exposure continue to be factored into pricing. Insurers are also closely monitoring severe convective storm (SCS) exposure as claims increase in frequency and severity. Builder’s risk insurers have not imposed any new exclusions on SCS but are limiting natural catastrophe coverage at $25 million to $50 million on large exposures.
LIABILITY
The general liability market for residential/for-sale properties — including single-family homes, tract homes, and condominiums — remains limited. Rates are typically two to five times higher than commercial rates, and buyers are seeing slight increases year over year. Class-action litigation on these properties is a key concern for underwriters.
Excess layers are also becoming more challenging. We are seeing more quota shares, and with no new carriers entering the market, competition is drying up and rates are rising.
Many contractors and owners are putting all for-sale products into CIPs. General contractors and subcontractors want this coverage under separate policies. For-sale properties are often excluded under policies purchased by these entities.
Many liability carriers now require third-party quality assurance/quality control at an additional cost and as a condition of underwriting. For insurance buyers, this underscores the importance of engaging insurance brokers and starting renewal processes early, to allow sufficient time to capture all insurance-related costs.
