Jim O. discusses one of the hot issues of the trades presently.
Insurance is a notoriously cyclical business with wild swings between a buyer's and seller's market. Though it may not have felt like it, construction contractors were in an exceptionally long buyer's market from about 1985 until the last couple of years. Rates were on an upward swing even before Sept. 11, especially for worker's compensation and general business liability coverages, simply because losses were rising.
For instance, the National Council on Compensation Insurance calculated that in 2000, workers compensation insurers paid out $1.21 in claims and expenses for every premium dollar taken in. Premium rates had dropped overall by 39 percent between 1994 and 1999 before starting to increase in 2000. (NCCI's data covers the insurance industry as a whole; I doubt workers' comp costs dropped that much for construction firms.)