Engineering Insurance Market Research Report By Project Type (EPC Contracts, Plant & Machinery, Erection All Risks, Construction All Risks, Delay in Start-up, Advance Loss of Profit), By Coverage Level (First-party Insurance, Third-party Liability Insurance, Combined First-party and Third-party Liability Insurance), By Industry Vertical (Oil and Gas, Power and Energy, Construction, Manufacturing, Infrastructure, Mining), By Policy Term (Short-term Policies (1-5 Years), Medium-term Policies (5-10 Years), Long-term Policies (10+ Years)) and B

Global Engineering Insurance Market Overview

Engineering Insurance Market Size was estimated at 24.1 (USD Billion) in 2022. The Engineering Insurance Market Industry is expected to grow from 26.4(USD Billion) in 2023 to 58.6 (USD Billion) by 2032. The Engineering Insurance Market CAGR (growth rate) is expected to be around 9.5% during the forecast period (2024 - 2032).

Source: Primary Research, Secondary Research, MRFR Database and Analyst Review

Key Engineering Insurance Market Trends Highlighted

Key market drivers for engineering insurance include the growing complexity and scale of engineering projects, increasing regulatory requirements, and raising awareness of the financial risks associated with engineering activities. The market is further driven by the increasing adoption of new technologies, such as artificial intelligence and the Internet of Things, which are creating new opportunities for innovation and growth.Opportunities to be explored or captured in the engineering insurance market include the development of new products and services that meet the evolving needs of customers, the expansion into new geographic markets, and the adoption of new technologies to improve efficiency and reduce costs.Recent trends in the engineering insurance market include the increasing use of data analytics to assess risk and develop tailored insurance solutions, the growing adoption of parametric insurance products, and the emergence of new players in the market, such as insurtech companies. These trends are expected to continue in the coming years, shaping the future of the engineering insurance market.

Engineering Insurance Market Drivers

Increasing Complexity of Engineering Projects

The engineering industry is very dynamic, with new technologies and processes becoming available all the time. As such, there is an ever-increasing need for engineering insurance. This kind of insurance can protect businesses from the financial repercussions of accidents or delays during an engineering project. One of the most prominent market growth drivers in the  Engineering Insurance Market Industry is, indeed, the growing complexity of engineering projects.As new technologies become available to the engineering industry, projects are also becoming more and more complex. This is, in turn, increasing the risks involved in these projects, prompting businesses around the world to demand more and more engineering insurance. As a result, this trend is likely to continue to shape the engineering insurance market in the following years.

Rising Awareness of Risk Management

Businesses are finding an increasing awareness of the essential nature of risk management, which is leading to an even greater propensity to seek engineering insurance. Such insurance can not only help companies identify and manage risks but can also provide financial protection in the form of compensation should an accident or other unforeseeable incident materialize. Rising risk management awareness is, therefore, a leading growth driver for the  Engineering Insurance Market Industry.The more companies are aware of the potential risks of their operations and other factors, the more they are turning to engineering insurance in the maintenance of such risks.

Increasing Government Regulations

Around the world, the number of governments that require businesses to have engineering insurance is increasing. The businesses affected most are those which belong to high-risk industries (construction, manufacturing). Hence, it is possible to say that the growth of government regulations is a major factor that contributes to healthy prospects of the  Engineering Insurance Market Industry. As more regulations are expected, it can be said that the demand for this type of insurance will continue growing.

Engineering Insurance Market Segment Insights

Engineering Insurance Market Project Type Insights

The Project Type segment of the  Engineering Insurance Market is estimated to record a remarkable growth over the forthcoming years. This is owed to the mounting creation of new and upgrading of the old infrastructure, alongside the increasing number of industries worldwide. Key sub-segments in this category include EPC Contracts, Plant Machinery, Erection All Risks, Construction All Risks, Delay in Start-up, and Advance Loss of Profit. The EPC Contracts sub-segment is anticipated to garner a considerable share of the Engineering Insurance Market.

This is attributed to the heightening application of investments in the form of a package of services rendered to construct various facilities from scratch. This refers to the growing demand for turnkey construction projects that involve contractors funding and completing designs, procuring equipment and materials, and construction. The inherent complexity and size of EPC Contracts have bolstered the need for insurance to cover a number of risks, thus encouraging the use of different forms of compensatory payments, including advances, legal fines and penalties, and damages.

Another salient sub-segment is Plant Machinery. The insurance comprehensively covers risks associated with the delivery, assembly, operation, and repair of different types of machinery that hold the purpose of settling, loading, processing, or transforming different materials. Perpetual advancements in auto technology generate the proliferating need for Plant Machinery. Erection All Risks insurance facilitates the coverage of different individuals, top executives, and other auxiliary staff involved in the construction process from respective emergency situations, like natural catastrophes, technological breakdowns, hooliganism as well as theft, and sabotage.

The active growth of large construction and infrastructure projects in countries such as Russia, India, China, and Saudi Arabia is expected to improve the application of Erection All Risks in the Engineering Insurance Market. Construction All Risks sub-segment emanates from the need to construct new structures and upgrade the existing ones. This results in property damage, liability, and, potentially, business interruption. A delay in start-up insurance is necessary to cover the financial loss of customers and owners from the delayed start of the project.

Many construction companies experience delays mainly due to weather changes and poor supply of materials. This explains the steep growth in the application of delay in start-ups in the engineering insurance market. Advance Loss of Profit sub-segment covers possible loss of profits due to a delay in implementing a project. This situation is becoming more and more common due to increasing requirements for project implementation periods both at the national and international levels.

Source: Primary Research, Secondary Research, MRFR Database and Analyst Review

Engineering Insurance Market Coverage Level Insights

The  Engineering Insurance Market is segmented by Coverage Level into First-party Insurance, Third-party Liability Insurance, and Combined First-party and Third-party Liability Insurance. Among these segments, First-party Insurance accounted for the largest market share in 2023, and is projected to continue its dominance throughout the forecast period. This growth is attributed to the increasing demand for protection against property damage, business interruption, and other first-party risks. The Third-party Liability Insurance segment is also expected to witness significant growth during the forecast period, owing to the rising awareness of liability risks and the stringent regulatory landscape.Combined First-party and Third-party Liability Insurance is gaining traction as it provides comprehensive coverage for both first-party and third-party risks, offering a cost-effective solution for businesses.

Engineering Insurance Market Industry Vertical Insights

The industry vertical segment plays a crucial role in shaping the  Engineering Insurance Market. Among the key industry verticals, Oil and Gas is projected to hold a significant market share, driven by the rising demand for energy and the increasing complexity of offshore exploration and production activities. The Power and Energy sector is also poised for growth, fueled by the transition towards renewable energy sources and the need for reliable infrastructure. Construction, Manufacturing, Infrastructure, and Mining are other important industry verticals that contribute to the  Engineering Insurance Market growth.These sectors require specialized insurance coverage to mitigate risks associated with complex projects, equipment breakdowns, and liability exposures.

Engineering Insurance Market Policy Term Insights

The  Engineering Insurance Market is segmented based on Policy Term into Short-term Policies (1-5 Years), Medium-term Policies (5-10 Years), and Long-term Policies (10+ Years). Among these, the Short-term Policies segment held the largest market share in 2023, accounting for around 45.2% of the  Engineering Insurance Market revenue. This is primarily due to businesses' preference for short-term policies that provide flexibility and allow them to adjust their coverage as per their changing needs. 

However, the Medium-term Policies segment is expected to witness significant growth during the forecast period (2024-2032), owing to the increasing adoption of medium-term policies by businesses seeking stability and cost-effectiveness. Long-term Policies, on the other hand, are expected to have a steady growth rate during the forecast period, as businesses with long-term projects and infrastructure development need to opt for these policies to secure their projects over an extended period.

Engineering Insurance Market Regional Insights

The  Engineering Insurance Market segmentation by region provides valuable insights into the geographical distribution of the market. North America held the largest market share in 2023, accounting for 38.5% of the  Engineering Insurance Market revenue. The region's dominance can be attributed to the presence of several major engineering and construction companies, as well as stringent regulations requiring engineering insurance coverage. 

Europe, with its well-developed infrastructure and insurance industry, held the second-largest market share at 31.2%.The APAC region is projected to witness significant growth over the forecast period, driven by rising infrastructure development and increasing awareness of engineering insurance. South America and MEA are also expected to contribute to the market growth, albeit at a slower pace compared to APAC.

Source: Primary Research, Secondary Research, MRFR Database and Analyst Review

Engineering Insurance Market Key Players And Competitive Insights

Major players in the engineering insurance market are actively focused on developing customized solutions to expand their product offerings to suit specific industry needs. Expanding business by acquiring institutional clients and implementing technology to improve underwriting and enhance operational efficiency are the other key focus areas of these major players. Increasing focus on the growth of the engineering insurance market and enhancing the strategic focus of the insurance sector have enabled major engineering insurance market companies to participate increasingly in the growth opportunities in the market. Chubb is the key player in the Engineering Insurance Market. 

The leading player in the market is well known for its wide range of insurance products and strong financial stability. The company operates in all major  regions and has acquired a huge customer base through its variety of engineering insurance products, including property, liability, and professional indemnity insurance. In addition, the company’s customers are provided with superior risk management services and loss prevention engineering services. The strong brand presence of Chubb in the engineering insurance market, along with its customer-centric approach, has helped the company secure a strong leadership position in the industry.

AIG is one of the key competitors and the leading player in the engineering insurance market. The company has a varied array of engineering insurance products that include property, liability, and professional indemnity insurance. The company's service offerings are risk management and loss prevention engineering services. AIG has secured a remarkable position in the engineering insurance market with its strong brand presence and superior underwriting capabilities. The company also focuses on delivering customized solutions to customers.

Key Companies in the Engineering Insurance Market Include

• Jardine Lloyd Thompson Group


• Zurich Insurance Group


• Travelers Companies, Inc.


• Gallagher


• Berkshire Hathaway Inc.


• Liberty Mutual Insurance Group


• Allianz SE


• Chubb Limited


• AIG


• Marsh McLennan Companies


• AXA SA


• Munich Re


• Willis Towers Watson


• Swiss Re


• Hannover Re

Engineering Insurance Market Industry Developments

The Engineering Insurance Market is witnessing steady growth, driven by increasing infrastructure projects, rising awareness of risk management, and stringent government regulations. In 2023, the market was valued at USD 68.07 billion and is projected to reach USD 102.3 billion by 2032, exhibiting a CAGR of 4.63%. Key market trends include the adoption of digital technologies, expanding coverage for cyber risks, and growing demand for specialized insurance products.

Recent developments in the market include the launch of innovative insurance products tailored to specific engineering disciplines, such as renewable energy and construction. Insurers are also focusing on sustainability initiatives and offering incentives for businesses that implement risk mitigation measures. The market is expected to witness increased competition as new entrants emerge and established players expand their geographical reach.

Engineering Insurance Market Segmentation Insights

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  Engineering Insurance Market Project Type Outlook

  
  
  
  
  • EPC Contracts
  
  
  • Plant Machinery
  
  
  • Erection All Risks
  
  
  • Construction All Risks
  
  
  • Delay in Start-up
  
  
  • Advance Loss of Profit
  
  
  
  


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  Engineering Insurance Market Coverage Level Outlook

  
  
  
  
  • First-party Insurance
  
  
  • Third-party Liability Insurance
  
  
  • Combined First-party and Third-party Liability Insurance
  
  
  
  


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  Engineering Insurance Market Industry Vertical Outlook

  
  
  
  
  • Oil and Gas
  
  
  • Power and Energy
  
  
  • Construction
  
  
  • Manufacturing
  
  
  • Infrastructure
  
  
  • Mining
  
  
  
  


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  Engineering Insurance Market Policy Term Outlook

  
  
  
  
  • Short-term Policies (1-5 Years)
  
  
  • Medium-term Policies (5-10 Years)
  
  
  • Long-term Policies (10+ Years)
  
  
  
  


• 
  

  Engineering Insurance Market Regional Outlook

  
  
  
  
  • North America
  
  
  • Europe
  
  
  • South America
  
  
  • Asia Pacific
  
  
  • Middle East and Africa