The new law includes $550 billion in new spending on infrastructure over the next five years and billions more to promote environmental and social investments, such as clean energy technologies.
The Best’s Special Report, “New Infrastructure Law Expected to Boost US Surety Market,” notes that the surety segment saw a slowdown in premiums as the pandemic led to reduced construction spending during the 2020 recession.
Surety underwriting results in 2020 declined moderately compared with 2019 due to an uptick in losses as contractors adjusted to mandatory government shutdowns and supply chain disruptions.
“Implementation of projects under the new infrastructure law will largely determine the health and prospects for the U.S.
AM Best said that given the strong operating performance despite pandemic conditions, as well as the strengthening economy and construction industry, it has revised its market segment outlook on the U.S.