Insights

Construction Industry Trends in 2026: 5 Numbers Worth Knowing

The Jencap Construction Insurance Team — Thu, 30 Jul 2026 10:00:00 GMT

Every year brings new commentary about where the construction insurance market is headed. This year, Deloitte’s 2026 Engineering and Construction Industry Outlook gives agents plenty to work with. Tariffs, labor gaps, and a shifting builders risk market are reshaping what your construction clients need from their coverage, and the data points below show exactly where. Here are five numbers worth knowing before your next construction renewal conversation.

25% to 30%: The Tariff Rate Reshaping Project Valuations

The effective tariff rate on construction goods hit a 40-year high of 25% to 30% in 2025, with steel and aluminum tariffs reaching as high as 50%. Material prices climbed steadily through the back half of the year.

For agents, this is a valuation problem before it’s anything else. A builders risk insurance policy written a year ago, at last year’s material costs, may already be underinsured. Encourage clients to revisit project valuations regularly rather than setting them once at the start of a build.

176 Gigawatts: The Data Center Boom Changing Project Scale

Power demand from U.S. data centers could grow more than fivefold by 2035, from 33 gigawatts to 176 gigawatts, according to Deloitte. These builds run into the billions and function more like small utilities than typical commercial projects, so standard commercial coverage may not be enough. Clients moving into this space need capacity and construction risk management built for megaproject scale.

499,000: The Worker Gap Straining Every Job Site

Half a million new workers. That’s roughly what the industry needs in 2026, up from 439,000 the year before. Factor in Deloitte’s numbers on retirement, 41% of the current workforce by 2031, and youth, just 10% of workers under 25, and the picture only tightens.

A workforce this stretched creates more than hiring headaches. It raises the odds of subcontractor default, safety incidents on understaffed crews, and workers’ compensation claims tied to less experienced labor. Ask clients how they’re managing crew experience, not just crew size.

30%: More Projects Are Entering the Pipeline

Commercial and institutional planning activity rose 30% year over year in August 2025, even as overall commercial construction activity slowed for much of the year. Projects in planning today are the accounts headed toward groundbreaking, and toward a builders risk quote in the months ahead.

Get in early. Agents who engage these accounts while they’re still in planning have more room to shop terms and secure capacity before a project moves to active construction and the coverage clock starts.

88.2%: The Jump in Project Abandonment

A fuller pipeline doesn’t mean every project reaches the finish line. Project abandonment activity rose 88.2% year over year in August 2025 as elevated costs pushed developers to walk away from planned work. Cost pressure, not just weather or delay, is now a real driver of projects stalling mid-build. This puts a spotlight on contract language. Cancellation provisions, valuation clauses, and how a policy responds if a project stalls or is abandoned outright all matter more than they did a few years ago.

A Construction Liability Insurance Checklist

Five numbers, five conversations. Work your way through this checklist to start a dialogue with your construction accounts:

Confirm builders risk valuations reflect current material and tariff-driven costs
Ask whether any upcoming projects involve data centers or large-scale energy infrastructure
Review subcontractor vetting and workers’ compensation exposure given labor shortages
Revisit builders risk placements written during the hard market for better terms
Check cancellation and valuation language in case a project stalls or is abandoned

FAQ

Why did builders risk insurance pricing loosen in 2026?

After a prolonged period of rate hardening, more capacity entered the market and insurers grew more open to larger, more complex projects, giving agents room to negotiate better property insurance terms.

How do tariffs affect a client’s coverage limits?

Rising material costs from tariffs can outpace a project’s stated value, leaving coverage limits too low if valuations aren’t updated regularly.

Are data center projects harder to place?

They typically require more capacity and specialized risk engineering than standard commercial builds, given their scale and unique infrastructure needs.

What should agents watch for with labor shortages?

Increased subcontractor default risk, safety incidents tied to less experienced crews, and workers’ compensation exposure are all worth reviewing with clients directly.

The Jencap Advantage

Construction risk management doesn’t sit still, and neither should your placements. Jencap’s construction team works these accounts every day, from standard commercial builds to complex wrap-ups, with the market access and insight to help you place even the trickiest risks with confidence.

Have a contractor insurance account that doesn’t fit the standard mold? Reach out to the Jencap Construction team to talk through your options.

Construction Manager vs. General Contractor: Why the Difference Matters for Insurance

The Jencap Construction Insurance Team — Thu, 23 Jul 2026 10:00:00 GMT

Two prospects walk into your office. Both call themselves a “construction manager.” One never touches a hammer or signs a subcontract. The other hires every trade on the job, controls the schedule, and is on the hook if the building leaks. Same title, two completely different risks.

That gap causes real problems in construction liability submissions. Misclassify a construction manager (CM) as a general contractor (GC), or vice versa, and you can end up with the wrong coverage structure, a mispriced account, or a declined submission that should have been an easy bind. Here’s how to tell the two apart, and why it matters once the file lands on an underwriter’s desk.

What Does a Construction Manager Actually Do?

A construction manager is hired by the project owner or developer to oversee a project on the owner’s behalf. The keyword is oversee. A true agency construction manager doesn't perform construction work and doesn't hire or pay subcontractors directly. Instead, they act as the owner's eyes and ears and advisor throughout the project, never as an executive supervisor on site directing and controlling subcontractors' work. That kind of control, like swinging a hammer, signing subcontracts, or guaranteeing a completion date, belongs to the GC, not the CM. And because they don't build, they don't carry the contractor's financial risk.

Typical CM services include:

Budget development
Scheduling
Constructability reviews
Permitting and insurance verification
Quality control reviews
Financial status reporting
Punch list verification at closeout

What Does a General Contractor Do?

A general contractor takes on the actual work of building the project. Where a CM’s relationship with the owner runs through advisory reports and meetings, a GC’s relationship runs through the construction contract itself, usually with some form of price or schedule guarantee attached. Typical GC responsibilities include:

Hiring and managing subcontractors
Performing construction work with their own crews
Procuring materials and equipment
Controlling daily site operations and safety
Guaranteeing a cost or completion date to the owner
Assuming direct responsibility for the finished work

A GC builds, controls the job site, and carries the financial and legal risk that comes with both.

Where the Lines Blur: The “At-Risk” Construction Manager

If every CM fit neatly into the model above, things would be a lot easier. But many firms operate under a Construction Manager at Risk (CMAR) delivery method, and that’s where classification gets tricky.

An at-risk CM delivers construction management services within a guaranteed maximum price or a fixed completion deadline, often with a bonus tied to hitting both. That guarantee changes the risk picture entirely. A CM under pressure to protect a fixed budget has more incentive to cut corners, accelerate schedules, or push subcontractors harder than an agency CM who’s only providing advice.

Some firms go a step further. They market themselves as a CM and let the owner pay subcontractors directly, but they still control the subs’ schedules, safety, and scope of work. It's not uncommon for what's really a GC to call itself "construction management" simply because the label sounds more sophisticated, even when the firm is clearly contracting the work rather than advising on it. Insurance carriers don’t classify based on the label. If the firm retains job site control over subcontractors, regardless of how the money flows, a carrier will likely treat that account as a GC for underwriting purposes.

The contractual label and the insurance classification are two different questions. Only one of them determines if your client will need general contractor insurance or construction manager insurance coverage.

A Quick Gut-Check for Agents

Before you build a submission, run the account through a few quick questions:

Do they hire subcontractors and oversee their construction activities? A yes points toward GC or at-risk CM.
Do they provide actual construction services with their own employees? A yes points toward general contractor insurance.
Do they contractually guarantee a cost or completion date to the owner? A yes points toward at-risk classification.
Do they act primarily as the owner’s agent or consultant, without performing the work themselves? A yes points toward construction manager insurance.
Do they prepare contracts and evaluate bids on behalf of the owner, but stay out of hiring subs? A yes reinforces agency CM.

If you’re seeing mostly “no” on subcontractor hiring, hands-on construction, and cost guarantees, you’re likely looking at a true agency CM. If any of those come back “yes,” you may be looking at a GC, a trade contractor, or an at-risk CM, and the coverage conversation needs to shift accordingly. If you’re still not sure, a specialty broker who works construction risk every day can help you make the call before you build the submission.

Why Misclassification Creates Construction Liability Gaps

A CM’s risk is largely professional: flawed scheduling advice, a missed budget projection, or a bad constructability review can trigger a negligence claim even though the CM never touched the work. A GL policy alone won’t respond to that kind of economic-loss claim, and a PL policy alone won’t respond if a bodily injury claim arises on the same project. CMs need both.

General contractors carry a different exposure. Because GCs control the work and the workforce, they carry direct responsibility for construction defects, subcontractor performance, and site safety, and the severity of those claims is only climbing. Submit a true GC risk as a CM and you underprice a bigger exposure. Submit an at-risk CM as a simple agency consultant and your client may be left without the protection they need when a cost overrun turns into a lawsuit. A clear narrative, scope-of-work letter, and loss history that reflect the firm’s actual role go a long way toward avoiding both outcomes.

FAQ

Is construction manager insurance the same thing as general contractor insurance?

No, because those are two different roles. A construction manager typically advises and oversees on the owner’s behalf, while a general contractor performs the actual construction work and hires subcontractors directly.

What makes a construction manager “at risk”?

An at-risk CM guarantees a maximum project cost or a completion deadline, which shifts financial risk onto the CM and changes how carriers underwrite the account.

How can an agent tell if a self-described “construction manager” is really operating as a general contractor?

Look at who hires and controls the subcontractors and who guarantees the project’s cost or schedule. If the prospect retains that control, regardless of their title, carriers will likely classify them as a GC or an at-risk CM.

How Jencap Can Help

Once you’ve nailed down whether you’re looking at a CM or a GC, Jencap can help you find the right home for it. Our exclusive Construction Managers Program brings general liability and professional liability together in one policy, so you’re not stuck choosing which form a claim should fall under. It also comes with subpoena and defense expense coverage and premium credits for Certified Construction Managers (CCM). Have a construction liability account on your desk? Get a quote and let’s talk through it.

OCIP vs. CCIP: Choosing the Right Wrap-Up Program for Your Construction Project

The Jencap Construction Insurance Team — Thu, 16 Jul 2026 16:51:55 GMT

A mid-size apartment complex is going up with a general contractor (GC), a dozen subcontractors, and a handful of suppliers, all on site at once. Each one carries its own insurance policy in its own name, with its own limits and exclusions. That arrangement works fine…until something goes wrong. Then it becomes a question of which policy applies, who is at fault, and how long the answer takes to sort out. U.S. construction spending is running at a seasonally adjusted annual rate of $2.17 trillion, and a meaningful share of that activity involves exactly this kind of multi-party risk.

Construction wrap-up insurance programs, specifically Owner-Controlled Insurance Programs (OCIPs) and Contractor-Controlled Insurance Programs (CCIPs), exist to solve that problem by placing all enrolled parties under a single policy. For retail agents working construction accounts, knowing when a project calls for a wrap-up program and which type fits best can be the difference between a clean placement and a frustrated client.

What Is a Wrap-Up Insurance Program?

Unlike a typical construction policy that is written annually , construction wrap-up insurance is project-specific and built around a single job or a defined group of related jobs. As Mike Yovino, a Jencap Construction Specialist Broker, puts it, “A wrap-up literally ‘wraps’ the site into a policy that the owner, the contractor, and subcontractors are all enrolled in. The policy ensures that there’s consistent coverage for everybody enrolled, and the ability to eliminate coverage gaps becomes more seamless.”

The two main types differ in who holds the policy:

OCIP (Owner-Controlled Insurance Program): The property owner or developer purchases and administers the policy. This works well for large institutional owners, developers, and public entities who want direct oversight of project risk.
CCIP (Contractor-Controlled Insurance Program): The general contractor or construction manager holds the policy instead. This often fits projects where the GC has stronger safety controls, more leverage with carriers, or a portfolio of similar projects to wrap together.

Both structures consolidate coverage. The difference comes down to who is in the driver’s seat.

OCIP and CCIP Submission Requirements

Whichever structure fits, early and complete submissions make a real difference in pricing and terms. Underwriters generally want to see:

A completed ACORD application
A wrap-up or project supplemental form
Pedigree detail and loss runs for the general contractor or developer
A structural geotechnical report
GC safety manuals
A site plan
The construction budget and timeline

Retail agents who bring these pieces together before submitting tend to get faster, more competitive responses from the market. Waiting until close to a project’s start date narrows the options and can put pricing leverage at risk.

What Do OCIPs and CCIPs Cover?

No two wrap-up programs look exactly alike, since each is custom-built around a specific project. That said, most include:

Commercial general liability
Workers’ compensation
Completed operations coverage
Commercial umbrella coverage

CCIPs in particular can be structured two ways. A single-project CCIP covers one job from start to finish, while a rolling CCIP covers multiple similar projects under a single ongoing program, which can suit contractors who repeatedly build for the same client type. Wrap-up programs are broad, but not unlimited. Commercial auto, off-site contractors, and certain third-party vendors typically fall outside the policy. Reviewing the specific terms for gaps is still worth the time, even on a well-built program.

The Benefits of OCIPs and CCIPs

Compared with traditional construction insurance, where each contractor buys a separate policy, wrap-up programs offer clear advantages.

Cost savings

Individually purchased policies pass their cost through to the project owner in each contractor’s quote. Consolidating coverage into a single program allows the owner or GC to negotiate rates in bulk, which often lowers the overall cost of insuring the project.

More complete coverage

Patchworked coverage from multiple carriers tends to create gaps. A custom-built wrap-up program, designed with an experienced broker, closes most of those gaps from the start.

Better risk management

Whoever holds the policy gains more control over safety requirements across the whole job site. Uniform loss-prevention standards reduce the odds of property damage and liability claims for everyone enrolled.

Simplified claims handling

Traditional construction insurance can mean several different carriers involved in one loss, each trying to determine fault before anyone pays. That kind of dispute is not rare. According to Arcadis’s 2025 Construction Disputes Report, the average value of a North American construction dispute reached $60.1 million in 2024, up 39.8 percent from the year before, with errors and gaps in contract or coverage documentation cited as a leading cause. A wrap-up program removes one major source of that friction, since one policy covers the loss regardless of which enrolled party caused it.

More flexible contractor selection

Because subcontractors don’t need to secure their own coverage to join the project, owners and GCs have more room to work with smaller or newer contractors who might not otherwise meet insurance requirements on their own.

As Yovino notes, the complexity of these programs is exactly why expert guidance matters: “There are a lot of things that go into a project before a shovel goes in the ground and through completion. It’s important to work with the right retail broker and wholesale broker who understand the intricacies of a wrap-up. There aren’t a lot of us in the country who specialize in this.”

Agent Checklist: Is the Project a Good Fit for a Wrap-Up Program?

Not every job needs construction wrap-up insurance. Building type matters less here than the structure behind the project. Before recommending traditional coverage or a wrap-up program, walk through these questions with the client.

Project Scope and Structure

How many contractors and subcontractors will be on site, and will that number grow as the project progresses?
What is the total construction value, and does it fall in the range, roughly $1 million up to multibillion-dollar, where wrap-ups typically make sense?
How long is the project timeline, and how much does coverage consistency matter across that span?
Is this a single project, or part of a series of similar projects the owner or GC could roll into one ongoing program?

Risk and Control

Does the owner or GC want direct oversight of safety standards and loss-prevention measures across every enrolled party?
Are there contractors involved who might struggle to secure their own coverage, either due to limited work history or insufficient limits?
How exposed is this project to coverage disputes if multiple carriers are involved in a single claim?

Project Type Considerations

Does the project fall into a category where wrap-ups are common, such as large residential developments, hospitals, hotels, data centers, industrial plants, or civil and public infrastructure?
Are there specialized exposures, like railroad work or environmental risk, that call for additional coverage layers beyond the standard wrap-up package?

If the answers point toward a large, multi-party project with a long timeline and a real appetite for centralized control, a wrap-up program is worth exploring further. If the project is smaller or involves only a few contractors, traditional construction insurance placements are likely the simpler and more cost-effective route.

FAQ

What is the difference between OCIP and CCIP?

An OCIP is purchased and held by the property owner or developer. A CCIP is purchased and held by the general contractor or construction manager. Both consolidate coverage for enrolled parties under one policy, but control sits with a different party in each structure.

When should a project consider a wrap-up insurance program?

Wrap-up programs tend to fit large or complex projects with multiple contractors and subcontractors, long timelines, or construction values from roughly $1 million up to multibillion-dollar projects. Smaller, single-contractor jobs usually don’t need one.

What information do underwriters need for an OCIP or CCIP submission?

At minimum, a completed ACORD application, wrap-up supplemental, loss runs and pedigree detail for the GC or developer, a geotechnical report, safety manuals, a site plan, and the construction budget and timeline.

Can a CCIP cover more than one project?

Yes. A single-project CCIP covers one job, while a rolling CCIP covers multiple related projects under one ongoing program, often used by contractors who repeatedly build for the same client.

Why Work with Jencap’s Wrap-Up Practice

OCIPs and CCIPs are not simple off-the-shelf placements. Getting the structure, coverage, and timing right takes a broker who has handled wrap-up programs across project types, from single-family developments to stadiums and data centers. Jencap’s construction team brings decades of combined experience to these placements, with the carrier relationships needed to secure broad terms and competitive pricing for retail partners. Reach out to Jencap today to discuss a wrap-up program for your client’s next project.

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