Tailored General Liability Solutions for Today’s Construction Landscape

Rising claim severity, social inflation, expanding litigation and increasingly complex projects have reshaped the way construction risks are evaluated and insured. Claims that once resulted in relatively modest settlements can now lead to significantly larger verdicts and defense costs, particularly in jurisdictions known for plaintiff-friendly legal environments.

"Construction has become viewed as a liability for all contractors, whether big or small," says Steve Sanchez, RPS Vice President, Construction Program Facilities. "Insurance costs have been going up because of nuclear jury verdicts in certain states for losses that 15 or 20 years ago would have settled out of court."

As carrier appetites tighten, the market has increasingly shifted toward specialized solutions designed for the realities of contractors' operations.

One Industry with Different Needs

Not all contractors face the same exposures. A contractor with a handful of employees performing residential or light commercial work has vastly different insurance needs than a contractor generating tens of millions of dollars in annual revenue and managing complex projects with sophisticated contractual requirements.

RPS has recognized those differences and developed two distinct General Liability programs for construction clients.

While the programs differ in size and underwriting requirements, they share a common philosophy: contractors benefit from solutions designed for the work they perform rather than a one-size-fits-all approach.

"The demand for General Liability products for contractors is currently high, driven by increasing risks in the industry and regulatory requirements," Sanchez says. "Now is the time to target quality contractors who are looking to secure their business in a growing, competitive and litigious environment."

The Claims Driving Today's Market

Understanding the types of claims contractors face helps explain why specialized underwriting has become increasingly important.

Construction Defect and Completed Operations

"Construction defect claims remain among the most significant liability exposures facing contractors today," says Sanchez. These allegations often surface months or even years after work has been completed and may involve water intrusion, improper installation, faulty workmanship or other issues that allegedly caused property damage. Because they emerge long after a project concludes, they can be costly to investigate and defend.

Third-Party Bodily Injury

Slip-and-fall incidents and other third-party bodily injury claims remain a common exposure, particularly for contractors working in public settings or high-traffic areas. While employees generally rely on Workers' Compensation for workplace injuries, members of the public injured near job sites may pursue liability claims against contractors and other parties involved in the project.

Contractual Disputes

Contractors may also become involved in breach-of-contract allegations and broader disputes involving multiple parties.

"In many cases, parties involved in a project look to bring in multiple contractors and subcontractors when a claim arises," Sanchez explains. "Even when responsibility ultimately rests elsewhere, the cost of defending those allegations can be substantial."

Beyond the Policy: The Importance of Risk Management

Insurance is only one component of an effective risk management strategy. Successful contractors increasingly recognize the importance of accurate reporting, strong documentation, employee training and prompt claims response. The goal isn't simply to transfer risk but to prevent losses or mitigate their impact when they occur.

According to Sanchez, collaboration is key.

"Loss control isn't about looking for reasons to penalize contractors," he says. "It's about identifying discrepancies, addressing them early and working together to reduce the likelihood of future losses." That philosophy extends beyond traditional inspections. For larger contractors, RPS is working to integrate technology that supports daily toolbox talks, OSHA tracking, payroll verification, geo-fencing of job sites, multilingual communication and real-time claims reporting via photos and videos. The objective is to help contractors identify potential issues early, improve communication across diverse workforces and respond quickly to incidents.

As Sanchez explains, "We want to stop the bleeding the minute the claim occurs."

Even the strongest safety cultures cannot eliminate every claim. When incidents do occur, having established claims processes in place becomes equally important. For the RPS Construction facilities, claims are handled through Gallagher Bassett, helping coordinate investigations, manage communications and guide contractors through what can often be complex situations. The ability to respond quickly and effectively can make a meaningful difference in both outcomes and costs.

Aligning Coverage to the Contractor's Work and Exposures

The construction industry encompasses everyone from small artisan trades to contractors overseeing large-scale commercial developments. Programs like Contractors Select and Contractors Pro reflect the reality that contractors face different risks depending on their operations, project types, contractual obligations and growth trajectories. Specialized underwriting allows those differences to be evaluated thoughtfully rather than forcing businesses into a standardized framework.