Navigating a Hard Insurance Market

By Travis Bennett, Associate Director, National Casualty Loss Control Leader at Risk Strategies

If your concrete pumping business is facing steep increases in insurance renewals or struggling to obtain coverage, you're not alone. The insurance industry is currently experiencing a "hard market" environment when it comes to rates and insurability.

A hard market is a shift in the insurance cycle characterized by rising premiums, restricted coverage terms and decreased capacity for most types of insurance—especially for higher-risk businesses like concrete pumping. Understanding the factors driving the hard market can help pumpers develop strategies to soften its impact on their rates and increase their insurability.

What created the hard market

Today’s hard market isn't a random occurrence. Insurance claims have increased in severity, frequency and overall cost over the past several years—with no indication things will slow down in the short term. The key factors causing this landscape include general inflation, increased auto accident costs, catastrophic weather events and "nuclear" verdicts where plaintiffs receive exceedingly high compensation of at least $10 million. (Nuclear verdicts have increased by more than 27% in 2023.) As a result, insurance providers are tightening their underwriting criteria.

Concrete pumpers are particularly affected by the hard market due to construction’s inherent high-risk nature. Because concrete pumping involves complex machinery and operations, often in challenging environments, the potential for significant accidents makes insurers wary. A single incident involving a concrete pump can trigger multiple lines of insurance coverage, including:

• Business Auto to cover the vehicle chassis.
• Inland Marine for pump components.
• General Liability covering third-party property damage.

Other lines of insurance that could be triggered include:

• Workers' Compensation covering injuries to employees.
• Pollution for any claims related to spilled diesel, oil or hydraulic fluid.
• Umbrella/Excess, which kicks in when General Liability coverage is exhausted.

Strategies for pumpers

Unfortunately, many underwriters also lack in-depth knowledge about the concrete pumping industry and may incorrectly associate concrete pumpers with even higher risks and losses, resulting in higher premiums and more restrictive coverage. This is an opportunity for pumpers and their brokers to educate underwriters on what concrete pumping entails—and what it does not. One solution is to present documentation, like contracts between the general contractor and pump contractor or operator, showing the risk transfer to pumping customers. Another way to incorporate risk transfer is to print on job tickets the job site responsibilities outlined for general contractors and owners under ASME B30.27 Material Placement Systems.

Additional ways to make your company look more attractive and less risky to insurance carriers include:

• Installing front and rear cameras and GPS/fleet tracking systems on equipment and vehicles to encourage safe driving behavior and present key evidence proving company vehicles/drivers were not at fault during an accident. This is becoming a requirement with some carriers.
• Establish new-hire driver vetting procedures that include running a motor vehicle report (MVR) on candidates as well as checking the Federal Motor Carrier Administration’s Commercial Driver’s License Drug and Alcohol Clearinghouse database.
• Implement a well-documented safety and risk management program that holds all employees accountable for safety.

These strategies and more will be shared in the Navigating a Hard Insurance Market session during the American Concrete Pumping Association’s OSM Conference, October 5-6 in Austin, Texas. The presenters, Travis Bennett of Risk Strategies and Kyle Rask of NBIS, will help attendees wade through the rough waters of today’s insurance climate.