Commercial property claims are taking longer and costing more as supply chain constraints and construction market dynamics create a new layer of complexity for adjusters and policyholders.
The factors driving this are well-documented but still working through claims portfolios: specialty equipment with extended lead times, skilled contractor shortages in high-demand markets, material cost volatility that makes early loss estimates unreliable, and business interruption periods stretching beyond what standard policy periods anticipated.
Adjusters managing complex commercial property losses need to factor supply chain realities into their reserve projections from the outset, rather than starting with a pre-disruption baseline and adjusting upward as delays materialize. That requires staying current on actual market conditions -- contractor capacity, equipment lead times, material pricing -- in the relevant geography.
Carriers reviewing their commercial property policy language and sub-limits in light of these dynamics are finding gaps between coverage designed for a more stable supply environment and the claims realities of the current market. Those reviews, and subsequent product adjustments, are the responsible response to a changed landscape.
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