Thursday 27 May 2021

British insurance underwriters who make up core of professional indemnity market have departed the scene.

Engineers Ireland has warned the oireachtas finance committee that delivery of homes and other construction projects could be affected because engineers who carry out fire-safety inspections face higher insurance costs.

Engineers Ireland vice-president John Power said a number of UK insurance underwriters that dominated the professional indemnity market had withdrawn from the republic, while others had raised premiums as the industry deals with the aftermath of Brexit, the Grenfell Tower fire in London in 2017 and the 2018 collapse of British construction group Carillion.

'Narrowing what policies would cover'

Michael Lyons, chairman of Engineers Ireland’s fire and safety division, said many members were saying that quotes for policy renewals have “trebled or quadrupled” so far this year. In addition, underwriters were also narrowing what the policies would cover.

“If the current trend persists, after a year of renewal notices, there will be relatively few firms in a position to offer fire-safety certification design and of construction,” said Power.

“This will impact the approval of designs, commencement of projects or the handover of completed projects such as houses, flats, nursing homes and factories. The inevitability is that the construction sector will suffer significantly and there will be a significant number of job losses as professional level.”

The warning comes as construction here is only beginning to take off again following more than three months of virtual lockdown amid the COVID-19 pandemic.

Separately, industry figures say builders are facing big raw material price increases amid shortages of timber, steel, insulation and other supplies. This is being fuelled by a rise in global demand and pandemic-related blockages, as well as issues relating to Brexit.