Construction sector is biggest borrower for funding premium payments – Premium Credit

Of the business sectors taking advantage of premium finance to fund insurance premium payments, the construction industry is borrowing the most via this channel, with new analysis from Premium Credit revealing that construction firms accounted for 13.8% of all its loans in 2024.

The financial firm’s in-house lending data further identified that the professional and scientific sector accounted for the second highest share of premium finance loans last year (13.3%), followed by the manufacturing industry (9.9%), wholesale and retail trade (8%) and land transport (7.9%).

This ranking order of the industry sectors utilising premium finance has remained the same over the past three years, since 2022.

Jon Howells, chief commercial officer at Premium Credit, said: “Credit plays a major role in funding vital insurance premiums across a wide range of sectors, as demonstrated by the ongoing growth in loans we have seen. 

”It is particularly valuable in construction, which is consistently the biggest sector for lending.”

Rising costs

Premium Credit published this sector specific information alongside its regular Insurance Index – the index’s most recent iteration, published today (26 June 2025), surveyed 988 SME business owners and managers between 7 and 11 March 2025.

This found that 51% of respondents believe the cost of their business insurance has increased over the past 12 months, with 10% saying it has risen dramatically.

This is a slight decline year-on-year, when 50% of polled SMEs reported increases in business cover costs and 12% experienced dramatic rises.

The index further revealed that 54% of SMEs use some form of credit to pay for insurance premiums, borrowing an average of £1,180. More than one in 10 (15%) have borrowed more than £3,000 via this method.

The figures from this month’s index show a slight uptick in the number of SMEs using credit to pay for their insurance. For example, two years ago, 51% of SMEs were utilising premium finance, with average borrowing around £1,130.