Small contractors are going out of business due to a shortage of liability and construction all risks capacity, a panel of construction industry insurance specialists has said.
Speaking at the Association of Insurance and Risk Managers (Airmic) annual conference in Birmingham, Airmic chairman David Ireland, who is also managing director of Vinci Insurance Services, said that liability cover for roofing and scaffolding contractors is either almost impossible or impossible to get.
If contractors do not have liability cover then they are unable to trade legally.
He said: "I am regularly quoted five-fold premium increases."
Health Lambert executive director David Barnes added: "Those left in the market can choose their price."
He said the only market left for large construction all risks policies is now Royal & SunAlliance.
Liberty's John Spenceley said underwriters were demanding very detailed health and safety analysis from contractors.
Last week, Insurance Times reported that The Underwriter chief executive Keith Rutter is set to meet with FSA managing director John Tiner to discuss the problem. He said the problem is so dire that it could stop construction projects in the UK.
