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The Canadian construction boom is bringing new facets of the construction insurance sector into the limelight.
There’s a huge amount of competition in the sector, which is keeping insurers and brokers on their toes. Construction insurance is traditionally quite a tricky market to play in, and it requires sufficient technical knowledge and claims expertise for success.
A key industry trend observed by ENCON’s senior vice president of Construction and Environmental, Brian Cane, is a rise in the number of requests for pollution liability insurance for contractors.
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This coverage protects contractors against claims for third party property damage, third party bodily injury or third party environmental damage caused by pollution that resulted from their work.
“Why has there been an upswing in demand for pollution liability insurance? I think it’s just that there’s more awareness regarding environmental exposures in the marketplace right now,” Cane told Insurance Business.
“More and more risk managers, municipalities, government entities and money lenders are becoming increasingly aware of the environmental exposures that exist in all sectors of insurance. They’re placing greater importance among insureds to make sure they have proper environmental coverage in place.”
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Despite this supposed heightened awareness of environmental exposures in Canada, there are still some stumbling blocks for brokers to navigate when trying to sell pollution liability insurance to contractors.
A number of insureds reject the coverage because it’s not requested by contract – or they still don’t fully understand the environmental risks. Trying to convince unwilling contractors that environmental exposures exist can be challenging, according to Cane.
“It’s the responsibility of the insurers and companies like ENCON to educate the broker community about the environmental exposures that exist and to talk to them about the claims that we’re witnessing in the market right now,” said Cane.
“I think there’s a mandate for the insurance industry to educate the brokers so that they have the proper ammunition and the proper information to share with their clients. Ultimately, it’s the client’s decision but hopefully they make the proper choice and cover off that exposure.”
ENCON offers pollution liability insurance for contractors on an annual or project-specific basis. It’s part of the company’s “one-stop shop” package of construction insurance products, which also includes builders’ risk insurance, wrap-up liability coverage, CGL insurance, single project E&O, and more.
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