How Zurich can lead in a constrained repair market

A new claims reality

Across the UK construction ecosystem, labour shortages have emerged as the dominant pressure point. The sector is operating with hundreds of thousands fewer workers than in the late 2000s, while demand for repair, retrofit, and rebuilding continues to grow.

At the same time, skills gaps in key trades, particularly carpentry, roofing, and specialist finishing, are driving project delays, rising costs, and reduced delivery capacity.

While material supply chains have stabilised in some areas, labour scarcity has overtaken materials as the primary driver of cost inflation and delay in property reinstatement.

The implication is clear: claims are becoming more complex, more expensive, and more time consuming

The constraints are most evident in high-skill, low-volume repair categories, including:

• Heritage and bespoke joinery (e.g. oak staircases, period doors)
• Natural stone and marble finishes
• Conservation-grade roofing and masonry
• Ornamental plasterwork and decorative detailing

These repairs are uniquely exposed due to:

• A limited pool of experienced craftsmen
• Long training cycles for specialist trades
• Dependence on niche or overseas supply chains
• Limited scope for substitution without impacting indemnity

As a result, these claims frequently face longer lead times, higher procurement complexity, and greater cost volatility.

The impact on claims

Extended claims lifecycles

Reduced contractor availability means longer lead times both to commence and complete repairs, with industry data showing widespread project delays linked to skills shortages.

Increased severity and cost uncertainty

Labour cost inflation - now outpacing material cost growth - drives higher claim settlements and introduces greater volatility into reserving.

Rising customer expectations risk

Policyholders expect “like-for-like” reinstatement, but supply constraints increasingly challenge the feasibility of this standard - creating pressure on satisfaction and complaints.

Underinsurance exposure

Rapidly rising rebuild costs increase the risk that sums insured are inadequate at the point of loss, widening the protection gap.

In this environment, insurers must move beyond passive claims settlement and take a lead role in shaping repair outcomes.

What Zurich’s doing

Building specialist supply chains

Invest in curated networks of specialist contractors, including heritage and niche trades, to ensure consistent access to critical skills when they are needed most.

This includes:

• Pre-qualified panels for specialist repair categories
• Long-term partnerships to secure capacity
• National sourcing strategies to overcome regional shortages

Early technical intervention

We currently prioritise early identification of complex and specialist claims, enabling:

• Rapid escalation to expert adjusters
• Early contractor engagement
• More accurate scoping, pricing, and reserving

By addressing complexity upfront, we reduce downstream delays and disputes.

Flexible repair solutions

Recognising that strict like-for-like replacement is not always viable, we apply a pragmatic, policy-aligned approach to reinstatement:

• Careful use of high-quality substitute materials
• Transparent discussions with customers on options
• Clear documentation of outcomes and rationale

Strengthening customer communication

We recognise that supply constraints are not just an operational issue; they are a customer experience challenge.

We are therefore focused on:

• Setting realistic expectations early
• Providing proactive updates on delays and constraints
• Clearly explaining repair decisions and alternatives

Temporary disruption or structural shift?

Some pressures, such as global shipping disruption, may ease over time. However, the underlying causes of the specialist repairs crunch are structural.

• An ageing workforce and insufficient pipeline of new tradespeople
• Reduced labour mobility and persistent skills shortages
• Growing demand from retrofit, sustainability, and property resilience needs

As a result, capacity constraints in specialist repair segments are likely to persist for the foreseeable future.

An opportunity to differentiate

The specialist repairs crunch is undoubtedly a challenge - but it also presents a clear opportunity.

If we invest in:

• Strong specialist supply chains
• Technical claims expertise
• Flexible, customer-centric approaches

We will be better positioned to deliver faster, more reliable, and higher-quality outcomes.

In an environment where repair capability is increasingly scarce, the ability to secure and deploy specialist skills becomes a defining competitive advantage.

The property claims landscape is evolving. Labour scarcity, specialist skill constraints, and supply chain complexity are redefining what it takes to deliver on the promise of indemnity. Therefore, our approach needs to be simple:

Anticipate constraints. Secure capability. Deliver certainty.

By doing so, we aim not only to manage today’s challenges, but to set a new benchmark for claims excellence in a constrained repair economy.

Author:

Paul Gallacher, Zurich Private Clients Claims Manager