Insurance News:
The Future of Bonds and Sureties in the UK Market

The UK surety and bonds market is undergoing significant change, shaped by economic uncertainty, high-profile contractor insolvencies, and evolving insurer appetites. For brokers and underwriters operating in construction insurance, these shifts present both challenges and opportunities.

Market Pressures and Trends

In 2025, the UK surety market remains challenging. The withdrawal of major insurers such as QBE and First Underwriting in 2024 has reduced available capacity, making it harder for contractors to obtain bonds or resulting in more restrictive terms. Surety providers have tightened their requirements, conducting more rigorous due diligence and placing greater scrutiny on bond wordings and counter indemnities. This has led to longer response times and increased administrative burdens for brokers and underwriters.

Employers and funders are also demanding more onerous bond terms, while insurers are less willing to deviate from standard forms. Despite these headwinds, two new insurers entered the UK market in 2024, with another considering entry in 2025. The legacy of fixed-price contract issues is fading, making the market more attractive to new entrants. However, the market remains stressed, and maintaining strong relationships with bond providers is more important than ever.

Best Practices for Brokers and Underwriters

To navigate these conditions, brokers and underwriters are advised to:

• Engage with surety providers early to secure capacity.
• Negotiate early bond releases (e.g., at practical completion) to free up facility capacity for future projects.
• Provide clear, comprehensive information to support efficient underwriting.
• Stay informed about market entrants and emerging solutions.

The Global Surety Market Outlook

Globally, the surety market is experiencing robust growth. The market is projected to expand from $19.62 billion in 2024 to $21 billion in 2025, with a compound annual growth rate (CAGR) of around 7%. By 2029, it is forecast to reach $27.31 billion. This growth is driven by:

• Increased construction and infrastructure investment, especially in North America and Europe.
• Government regulations and public-private partnerships.
• Growth in private sector investment and SME participation in large projects.
• The adoption of digital payment services and innovations in underwriting and claims management.

Technological advancements are expected to further streamline surety processes, making bond placement and management more efficient for brokers and underwriters.

How Exance Supports Brokers and Underwriters

Exance is dedicated to making the bond and surety process easier and more effective for brokers and underwriters in the UK and beyond. Here’s how Exance adds value:

• Expert Guidance: Exance provides brokers with access to deep technical expertise, helping them navigate complex bond requirements and select the most suitable solutions for their clients.
• Tailored Solutions: Working closely with leading surety providers, Exance delivers bespoke bond placements that align with clients’ contractual and regulatory obligations, whether for domestic or cross-border projects.
• Streamlined Processes: Exance leverages its extensive network of global insurers and reinsurers to secure competitive terms and facilitate timely bond issuance, reducing administrative burdens and delays.
• Comprehensive Support: From risk assessment and underwriting submissions to claims management, Exance offers end-to-end support, ensuring brokers can confidently meet tight project deadlines and complex compliance requirements.
• Continuous Improvement: Exance provides ongoing monitoring, compliance updates, and optimisation advice, helping brokers adapt to changing client needs and market conditions.

By partnering with Exance, brokers and underwriters gain a trusted ally that simplifies the bond placement process, enhances service delivery, and enables them to capitalise on both UK and global market opportunities. As the UK and global surety markets evolve, brokers and underwriters who embrace expert support, proactive engagement, and innovative solutions will be best positioned to thrive. Exance stands ready to help its partners navigate this dynamic landscape with confidence and agility.