AI in Construction - opportunity vs risk

Thursday 5th November 2026

AI in Construction: the Opportunity is Clear, but What About the Risks?

Posted by Angus Nanan, Head of Construction, Kerry London Ltd

AI is rapidly becoming part of everyday business in the construction industry. Once viewed as an emerging technology, it is now being used for everything from reviewing contracts and creating reports to improving site safety and project management.

As specialist advisors to the construction sector, Kerry London is increasingly being asked the same questions: Should we be adopting AI? How can we embrace it while protecting our business, contracts and insurance position?

The reality is that AI is no longer a future consideration. The focus now should be on using it effectively, responsibly and with the right controls in place.

How is AI changing the construction industry?

Construction has always been built on expertise, experience and professional judgement. AI is not replacing these qualities; it is creating opportunities to enhance them.

Businesses across the sector are already using AI to:

Draft tender submissions
Analyse contracts and project documents
Generate reports and schedules
Identify trends in operational data
Support marketing and business development activities

AI is also beginning to influence Computer-Aided Design (CAD) and Building Information Modelling (BIM). AI-enabled tools can assist with design options, clash detection, quantity checking and the review of large volumes of project information.

Used correctly, these tools can improve efficiency and free up valuable time for higher-value tasks. However, as AI becomes more involved in design development and project coordination, it becomes increasingly important to understand what the technology has done, what has been independently reviewed and who remains responsible for the final output.

Where construction firms are missing an opportunity

One of the biggest misconceptions about AI is that it requires significant investment or technical expertise. In reality, many businesses are already using it successfully in simple, practical ways.

Project managers are using AI to summarise documents ahead of meetings. Business development teams are creating draft tender responses more efficiently. Directors are analysing business data and identifying trends more quickly.

The organisations gaining a competitive advantage today are not necessarily implementing complex systems. They are identifying repetitive tasks and using AI to improve productivity, consistency and decision-making.

At the same time, businesses should consider whether introducing AI affects their existing contractual obligations, cybersecurity exposures, insurance arrangements or regulatory responsibilities.

AI in CAD and BIM: where the risks become more technical

CAD and BIM environments combine design data, specifications, sequencing, cost information and contributions from multiple disciplines. Introducing AI into these environments can create efficiencies, but it can also amplify existing risks.

An inaccurate assumption, incomplete dataset or incorrect recommendation may be replicated across designs and project documentation before it is identified.

There is also the risk of over-reliance. An AI tool may identify a clash or generate a design solution, but it cannot determine whether that solution is compliant, buildable or appropriate for a specific project.

Design responsibility remains with the relevant professional team.

For this reason, firms should implement clear controls, including:

Approved software and permitted use cases
Human review and sign-off procedures
Version control and audit trails
Clear accountability for final outputs
Data protection and confidentiality controls

Businesses should also understand whether project information is stored, retained or used by AI providers beyond their own controlled environments.

Practical tips for using AI effectively

Like any new technology, AI delivers the greatest value when introduced with clear objectives and appropriate oversight.

Start by identifying one or two processes that could benefit from automation or support. This may include administration, reporting, document reviews or data analysis.

Organisations should also establish clear internal guidelines covering:

Approved AI tools
Permitted data inputs
Required review procedures
Responsibility for final outputs

Most importantly, human judgement must remain at the centre of decision-making. AI can be a powerful assistant, but it should not replace professional expertise, experience or accountability.

For CAD and BIM workflows, businesses should also document where AI has been used, maintain version histories and ensure that all material changes receive appropriate professional approval.

Training is equally important. Risks often arise when organisations introduce new technology without fully understanding how it works. Ensuring teams understand both the benefits and limitations of AI is a key part of responsible risk management.

Understanding the risks

While AI offers significant opportunities, businesses must remain aware of the associated risks.

One of the most significant concerns is data security. Construction firms regularly handle sensitive information, including client data, contracts, financial records and project documents. Uploading this information to public AI platforms without adequate controls may create confidentiality, compliance and cybersecurity risks.

Accuracy is another concern. AI-generated content can appear highly convincing, but it is not always correct. A summary may omit an important clause, a recommendation may overlook practical constraints, or a technical response may contain inaccuracies.

Ultimately, responsibility for decisions made using AI remains with the business, not the technology itself. Organisations should therefore maintain robust review procedures and be able to demonstrate how AI outputs have been checked and approved.

Liability, accountability and insurance

Accountability remains one of the most important questions surrounding AI adoption.

If an AI-assisted recommendation contributes to a design issue, project delay or contractual dispute, responsibility does not disappear simply because technology was involved.

This is particularly relevant for Professional Indemnity (PI) Insurance. A claim arising from an AI-assisted drawing, specification or BIM model may still be treated as an error within the professional service being provided.

At the same time, Cyber Insurance may also become relevant if AI-related systems contribute to data breaches, unauthorised access to project information or the corruption of digital models.

As AI becomes more integrated into construction businesses, organisations should ensure their insurance arrangements accurately reflect how technology is being used and that any potential gaps in cover are identified.

Why risk management matters

Many of the concerns surrounding AI are not entirely new. However, AI can increase the scale and speed at which existing risks emerge.

Professional indemnity, cyber liability, directors’ and officers’ responsibilities, data protection obligations and wider compliance requirements may all be affected by AI adoption.

The challenge is not the technology itself, but ensuring that governance, processes and insurance arrangements evolve alongside it.

This is where specialist advice can help. As construction businesses adopt new technologies, it is important to review risk management strategies and insurance programmes to ensure they remain appropriate for changing exposures.

Looking ahead

AI is becoming a standard part of modern business operations, and construction is no exception.

The organisations that succeed will not necessarily be the earliest adopters. They will be those that balance innovation with accountability, efficiency with oversight and technology with human expertise.

AI offers significant opportunities to improve productivity, support decision-making and enhance project delivery. However, successful adoption requires more than technology alone. Businesses need skilled people, clear governance, robust controls and appropriate insurance to manage the risks alongside the benefits.

For construction leaders, the greatest risk may not be adopting AI itself, but doing so without the governance, oversight and risk management measures needed to support it.

With the right approach, AI can become a valuable tool for helping construction businesses remain competitive in an increasingly technology-driven industry.

As AI becomes increasingly embedded in construction businesses, it is important to ensure that risk management strategies and insurance programmes evolve alongside it. Kerry London’s construction specialists can help review your exposure and ensure your business remains protected as technology continues to develop.