The Infrastructure Investment and Jobs Act (IIJA) marks one of the most significant physical infrastructure investments in the U.S. in more than five decades. It will lead to a growing number of projects and jobs across multiple industries. The insurance industry will need to be armed and ready to provide appropriate policy coverage for the influx of new projects.
What is the Infrastructure Investment and Jobs Act?
In November 2021, Congress passed a bipartisan infrastructure bill, the Infrastructure Investment and Jobs Act. The IIJA earmarks $550 billion to update our country’s infrastructure, which will result in millions of jobs being created. Some of the areas that will receive this funding include highways, the electric grid, passenger rail, broadband, water infrastructure, environmental resilience and remediation, public transit, waterways, ports, airports, and more.
These transformations will be broad and far-reaching. Anticipated improvements include reducing supply chain disruptions, ensuring clean drinking water, and making high-speed internet more available and affordable. Efforts from the IIJA will also combat climate change, such as setting up a national network of electric vehicle charging stations, increasing manufacturing of solar panels and wind farms, and providing incentives to source more US-based materials. Additionally, it makes historic investments in environmental clean-up and remediation. It will help make our infrastructure stronger and more resilient against the impacts of climate change and extreme weather events, including superstorms, droughts, wildfires, and hurricanes.
The amount of money allocated to states for this effort varies; federal highway and public transit aid account for nearly 80% of the state-specific allocations. The largest states by population (California, Texas, New York, Florida, Illinois, Pennsylvania, New Jersey, Ohio, Georgia, and Michigan) will receive the most funding. New England and the Mid-Atlantic Corridor will also receive a large share of public transportation funding, due to the higher density and extensive infrastructure in these regions.
What does the IIJA mean for businesses?
The IIJA will impact businesses across multiple sectors. For instance, engineering and construction experts predict industry growth, with 91% of engineering and construction executives saying the outlook for these industries looks positive (in large part due to the IIJA). Construction, engineering, and related fields will be hiring in 2022 and beyond to manage IIJA-related projects.
Additionally, the IIJA includes historic funding in the environmental sector, with money going to clean up long-standing pollution and redevelop communities. With this funding, communities living near the most serious areas of contamination will finally get the protections they deserve. Blighted and polluted sites in communities across America will be assessed, cleaned up and made available for safe reuse; spurring job creation and economic opportunity in areas that need it most.
What does this mean for insurance?
The IIJA will create so many new projects that will require various types of insurance coverage; including General Liability, Excess Liability, Worker’s Compensation, Transportation, and so much more.
As the pace of construction, environmental, and other projects pick up, insurers will want assurances that workers are well trained, worksite standards are safe, and risks are being mitigated. Many insureds are boosting loss-control activities such as employing electronic surveillance at construction sites, using fire retardants on wood-frame projects, installing water mitigation systems to prevent water damage, and taking other safety measures. Moving forward, businesses will need to demonstrate that they’re taking every possible precaution to ensure safe, profitable projects.
The growing need for insurance will expand far beyond the construction and environmental sectors.
What’s Jencap Got to Do With It?
Jencap is one of the largest wholesalers in the country, with specialized expertise in every sector that the Infrastructure Investment and Jobs Act will impact; spanning construction, real estate, environmental, and so much more. Our brokers understand the implications of the IIJA and are poised and ready to set your clients’ up for success.
There is strength in size and power in partnership. Put Jencap to work for you.