Why insurers belong in the room before infrastructure is built

Innovation, investment and growth all have one thing in common: confidence.

When innovators are confident that potential setbacks can be managed, they take risks. When businesses are confident in an opportunity, they invest. And when both happen together, growth follows.

Property damage, extreme weather, liability claims, cyber attacks and business interruption are just some of the risks that insurers protect against so that businesses of all sizes can operate.

Agata Gorecka, Association of British Insurers

As a product that gives people and organisations the confidence and reassurance they need to take risks, insurance is one of the foundations of growth.

Every day, commercial insurance helps keep the country moving. Property damage, extreme weather, liability claims, cyber attacks and business interruption are just some of the risks that insurers protect against so that businesses of all sizes can operate. 

That financial reassurance means they can employ people, invest in their business and strengthen supply chains. Without it, many would need to take a more cautious approach – slowing growth across the economy.

Enabling innovation

Insurance also plays a critical role in supporting innovation. As the UK pursues ambitious goals around clean energy, advanced technology and net zero, insurers help organisations navigate these new and complex risks. 

Our recent report, The Value of Commercial Insurance: Enabling growth, innovation, and resilience, highlights crucial projects that insurance has helped make possible. 

For example, carbon capture and storage projects, renewable energy developments and climate resilience initiatives. 

Through specialist expertise, risk modelling and financial protection, insurers help turn innovative ideas into investable propositions. 

But the sector’s contribution extends well beyond large-scale infrastructure and investment projects. 

It helps make many of the experiences we value possible, from major sporting and cultural events to the protection of historic buildings and other national treasures.

National infrastructure

One of the strongest arguments for the sector’s value lies in our national infrastructure. Insurance helps bring major projects across transport, energy and crucial national assets to life. 

For example, due to its exceptional scale and complexity, the Elizabeth Line relied on sophisticated insurance and risk management arrangements. 

Similar support has helped to deliver major electricity transmission projects, renewable energy infrastructure, and carbon capture developments, all of which are crucial to the UK’s future prosperity.

Too often, insurance is still seen primarily as a means of picking up the pieces when something goes wrong. But turning to insurers only in a time of crisis is missing a trick.

Insurers have the considerable and unique expertise to identify, quantify and mitigate risk. 

They understand how climate threats, cyber vulnerabilities, supply chain pressures and operational weaknesses can affect long-term resilience. That expertise needs to be harnessed.

If the government were to engage insurers at the outset of major infrastructure projects, resilience considerations could be built into design decisions, procurement strategies and operational planning. 

Insurers could identify vulnerabilities before construction starts, helping to reduce the likelihood of costly redesigns and improve investor confidence. 

Most importantly, resilience would be embedded from the start of a project rather than being retrofitted in later.

That’s why the government should establish routine opportunities for insurers to contribute during project development, before any key decisions are made.

Built to endure

At a time of increasingly complex and interconnected risks, resilience should never be treated as an afterthought in infrastructure policy and national planning. Instead, it should sit at the heart of both.

By making greater use of the unique perspective and understanding of future risks that commercial insurers have, government can make sure the next generation of infrastructure is not only built to support growth, but built to endure.