U.S. construction firms on average paid more for their insurancein the first half of 2013 as underwriters continue to seek priceincreases across the breadth of their contractor portfolios,according to a report published by Marsh.

Pricing for contractors general liability, project-specificgeneral liability, umbrella and excess liability, workers'compensation, and residential construction insurance was up between3 percent and 7 percent on average during the first half ofthe year, according to Marsh's Construction Market Update—First Half 2013.

Construction firms with poor loss histories were more likely ingeneral to have seen double-digit rate increases.

Pricing for non-residential construction, and contractors andarchitects and engineers professional liability insurance also wasup on average during the first half of the year, but to a lesserdegree.

“US construction firms are grappling with a firming insurancemarket, especially when it comes to liability insurance whereunderwriters continue to tighten coverage terms and seek rateincreases to make up for reduced investment income,” said MichaelAnderson, leader of Marsh's US Construction Practice. “With azero interest rate environment, there is no cushion against a poorunderwriting decision.”

According to Marsh's report, not all construction lines areexperiencing rate increases. Premium rates for builders riskinsurance generally remained flat during the first half of the yeardespite more demand for coverage. Similarly, contractors pollutionliability rates remained generally flat to down 5 percent.

“While underwriters are attempting to gain rate increases, themarket is awash in capital and new entrants are helping to maintaincompetition. The good news for well-managed construction firms isthey can still generally find competitive pricing andterms,” Anderson said.