This chapter is taken directly from Griffiths & Armour’s publication Constructing Change: Evolving the Status Quo or Time to Reset?, which brings together sector perspectives on key legal, construction and insurance challenges.
This chapter examines the unsustainable rise in indemnity spend and legal costs across the construction sector. It explores how claims conduct, poor data handling, and structural legal inefficiencies are contributing to a long-term increase in Professional Indemnity insurance premiums.
Extracts from the chapter:
Whilst care has been taken in the production of this article and the information contained within it has been obtained from sources that Griffiths & Armour, an Aon company believes to be reliable, Griffiths & Armour, an Aon company does not warrant, represent or guarantee the accuracy, adequacy, completeness or fitness for any purpose of the article or any part of it and can accept no liability for any loss incurred in any way whatsoever by any person who may rely on it. In any case any recipient shall be entirely responsible for the use to which it puts this article.“We estimate that around 60% of the total insurance claims bill relates to legal costs, encompassing the expenses of defending our clients and the costs borne by claimants. It is necessarily an estimate, as while insurers undoubtedly possess data on what fraction of their expenses pertain to legal costs, such information is commercially sensitive and not publicly accessible.”
“Given that the current framework eats up such a significant percentage of the bill, the question is: can we try to do it in a better way? – When it comes to the legal system’s failure to use net contribution clauses, I think, to be perfectly honest, we’ve been taken for a complete ride – we need to wise up.” Michael Moriarty
This article has been compiled using information available to us up to 25 July 2025
