According to Marsh's Construction Insurance Market Update 2025, the first half of the year saw average premium reductions ranging from 5% to 15%. Specifically, contract works insurance premiums decreased by approximately 5%, while design and construction professional indemnity premiums fell by about 10%. This softening is attributed to increased capacity and new entrants in the market since 2024, intensifying competition among insurers.
For construction businesses, this development presents an opportunity to secure more comprehensive coverage at reduced costs. However, it's essential to note that despite the decrease in premiums, insurers are maintaining rigorous underwriting standards. Risk assessments are becoming more thorough, with a particular focus on projects with complex or high-value components.
To capitalise on these favourable market conditions, construction firms should ensure their insurance submissions are well-structured and demonstrate robust risk management practices. Emphasising site safety, adhering to project timelines, and clear contractual allocations can serve as differentiators in securing optimal insurance terms.
In summary, the current softening of the construction insurance market in Australia offers a promising landscape for businesses. By proactively managing risks and presenting comprehensive insurance applications, construction firms can benefit from the competitive premiums and enhanced coverage options available in 2025.
Published: Saturday 14th February, 2026
Please Note: If this information affects you or is relevant to your circumstances, seek advice from a licensed professional.
