As we move into the first quarter of 2026, the insurance landscape for contractors and business owners is shifting. Navigating renewals requires more than just looking at a premium number; it requires understanding the "why" behind the rates.

Based on the latest Q4 2025 REDY Index data, we’ve broken down the three most important trends in Property, Excess Liability, and Employment Practices that will impact your insurance strategy this year.

1. Property Insurance: A Buyer’s Market (With a Catch)

The end of 2025 saw a significant win for policyholders. Roughly 87% of property accounts achieved rate reductions last quarter. This "soft market" is driven by a multi-year low in loss activity and an all-time high in available capital from investors.

What this means for you: While rates are favorable, underwriters are keeping a close eye on the economy. If new tariffs or supply chain issues drive up the cost of construction materials, your "replacement cost" values may need to be adjusted. At ContractorInsPro, we recommend reviewing your property limits now to ensure your coverage keeps pace with the actual cost of rebuilding in today’s market.

2. Excess & Umbrella: Stability in the High Layers

If you carry high-limit Umbrella or Excess Liability policies, there is good news. The market is stabilizing, particularly for "high-layer" coverage (layers above $10M). We are seeing increased competition among carriers, which often leads to better negotiation leverage for you.

The Warning Sign: While the higher layers are stable, the "primary" layers (the first $1M–$2M) remain firm. This is due to "social inflation"—the trend of rising legal costs and larger jury awards for bodily injury and auto accidents.

Pro Tip: To get the best rates, focus on your safety data. Accounts with clean loss histories and strong risk management protocols are the ones winning the biggest discounts right now.

3. Employment Practices (EPL): New Risks in the Workplace

The market for Employment Practices Liability Insurance (EPLI) remains competitive, but the types of claims are changing. As companies shift their internal policies (such as changes to DEI or ESG programs), we are seeing a rise in "reverse discrimination" and retaliation claims.

Emerging Trends to Watch:

Political Affiliation: While not yet a federal protection, several states are seeing more claims related to perceived political bias in the workplace.

Biometric Privacy (BIPA): If you use fingerprint scanners for time-clocks or security, be aware that carriers are tightening sub-limits for biometric privacy violations.

Retentions: Even if your premium stays flat, many insurers are increasing your "deductible" (retention), especially in high-litigation states like California or New York.

The Bottom Line for Your Business

The Q4 2025 data shows a market that is largely favorable to the consumer, but complexity is hiding beneath the surface. Whether it’s protecting your equipment from rising material costs or shielding your business from evolving employment lawsuits, having a specialist on your side is critical.

Ready to see how these trends affect your specific policy? At Contractor Insurance Pros, we use this data to negotiate the best possible outcomes for our clients. Contact us today for a comprehensive review of your 2026 insurance program.