Professional Indemnity Insurance
Cover for claims that your professional advice, design or service caused a client financial loss.
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What Is Professional Indemnity Insurance?
Professional indemnity insurance, also called professional liability or errors and omissions insurance, covers you if a client claims your advice, design or service caused them financial loss. It pays your legal defence costs and any compensation you’re found liable for, whether the claim is justified or not. It’s written on a claims-made basis, so it covers claims made while the policy is in force, regardless of when the work was done.
Why Professionals Use a Broker
PI policies differ in ways that only matter at claim time: the retroactive date, run-off terms, the limit, contract requirements and exclusions such as cladding. We compare wordings from specialist PI insurers and set your cover against your registration, your contracts and the work you actually do.
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Who Needs Professional Indemnity Insurance?
Anyone paid for professional advice, design or services needs PI insurance. We arrange cover for:
- Engineers: civil, structural, electrical, mechanical, HVAC, acoustic and fire safety
- Building and design professionals: architects, building designers, drafters, interior designers, landscape designers and lighting designers
- Construction professionals: construction managers, project managers, quantity surveyors, building surveyors and certifiers
- Surveyors and consultants: land surveyors, agricultural consultants, management and environmental consultants
- Advisers and other professionals: accountants, tax and BAS agents, IT consultants and marketing professionals
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What Does Professional Indemnity Insurance Cover?
Civil Liability
Covers your liability for a client’s financial loss caused by your negligence, error, omission or breach of professional duty, such as a design error, a missed deadline or incorrect advice.
Legal Defence Costs
Covers lawyers, court costs and the cost of investigating, defending and settling a claim, including costs advanced before the claim is resolved.
Inquiry Costs
Covers legal costs if you’re called before a regulator, registration board or disciplinary hearing over your professional conduct.
Unintentional Defamation
Covers claims that something you said or wrote in the course of your work unintentionally damaged someone’s reputation.
Intellectual Property Infringement
Covers claims that you unintentionally breached someone’s copyright, trademark or design rights.
Lost or Damaged Documents
Covers the cost of replacing or restoring client documents lost or damaged while in your care. Lost electronic data is usually covered under a cyber policy instead.
Fidelity Cover
Covers your liability for a client’s loss caused by the dishonest act of an employee.
Bodily Injury and Property Damage From Your Services
Covers injury or property damage that results directly from your professional services, such as a structural design error that causes a slab to crack. Many PI policies include this, and public liability policies often exclude it.
Request a Professional Indemnity Insurance Quote
For immediate response please give us a call.
Our team continues to work remotely but you are welcome to arrange an appointment with one of our consultants.
Get A Quote
Complete the form to request a QUOTE. Call us at 1300 900 207 for an immediate response.
How Does Professional Indemnity Insurance Work?
PI is written on a claims-made basis, and three terms decide whether a claim is covered:
Claims-Made Basis
A PI policy covers claims made against you while the policy is in force, regardless of when the work was done. Public liability works the other way, on an occurrence basis: it covers incidents that happen during the policy period, even if the claim comes later. With PI, if your cover lapses, protection for all your past work lapses with it.
Retroactive Date
The retroactive date is the earliest date of work your policy covers. Work done before that date isn’t covered, even if the claim is made while the policy is in force. An unlimited retroactive date covers all your past work. Choosing a later date can reduce your premium, but it leaves past work exposed. In NSW, registered design practitioners and engineers must be “adequately insured”, and a limited retroactive date can put that at risk.
Run-Off Cover
Run-off cover keeps you protected for past work after you retire, sell your business or stop trading. Claims can arrive years after a job is finished. Defective building work claims can be brought up to 10 years after completion in NSW, and up to 10 years after the occupancy permit in Victoria, where cladding claims can run up to 15 years. Without run-off, a claim about past work after your policy ends isn’t covered. It isn’t automatic, so arrange it before you wind down.
When Should You Notify Your Insurer?
As soon as you’re aware of anything that could lead to a claim, and before your policy expires. That includes a client complaint, a threat of legal action or a mistake you’ve discovered yourself. Under section 40(3) of the Insurance Contracts Act 1984, if you notify the insurer in writing of facts that might give rise to a claim, as soon as reasonably practicable and before the policy ends, a later claim arising from those facts is still covered by that policy. Courts have held that the notice must be in writing, as a phone call isn’t enough, and must set out actual facts rather than a general worry that something might go wrong.
Don’t admit liability or offer to fix the problem until you seek guidance.
How Much Does Professional Indemnity Insurance Cost?
Every policy is priced individually. The main factors are:
- Your profession: structural engineers and architects cost more to insure than management consultants or marketers.
- Turnover and size: larger fee income and bigger projects mean larger potential claims.
- Limit of indemnity: limits range from $250,000 for some regulated professions to $10 million or more. Your regulator, professional body or contracts often set the minimum.
- Retroactive date: an unlimited retroactive date costs more but covers all your past work.
- Claims history: previous claims and notified circumstances.
- Excess: a higher excess lowers the premium.
Professional Indemnity Insurance FAQs
Is professional indemnity insurance mandatory in Australia?
Not for every business, but it is for many professions, including registered health practitioners, tax and BAS agents, financial advisers and mortgage brokers, solicitors, migration agents, NSW real estate and strata managing agents, building practitioners in Victoria, and design practitioners and engineers in NSW. Many government and commercial contracts also require it.
How much professional indemnity cover do I need?
It depends on your profession, your contracts and the size of your projects. Limits range from $250,000 for some regulated professions to $10 million or more, and your regulator, professional body or contracts often set the minimum. We set your limit against your contracts and the size of your projects.
Does professional indemnity insurance cover work I did years ago?
Yes, if the claim is made while your policy is in force and the work was done after your retroactive date. An unlimited retroactive date covers all your past work.
What happens to my cover if I retire or close my business?
Your PI cover ends with your policy, and claims about past work can arrive years later. Run-off cover keeps you protected after you stop trading. There’s usually no set minimum period, so the right length depends on your profession and how long claims can be brought. Arrange it before you wind down.
Is errors and omissions insurance the same as professional indemnity?
Yes. Errors and omissions, professional liability and professional indemnity are different names for the same type of cover.
What Isn't Covered by Professional Indemnity Insurance?
- Known claims and circumstances: anything you were aware of before the policy started.
- Work before the retroactive date.
- Fraud, dishonesty and intentional acts by you.
- Contractual liability beyond your legal duty: guarantees, warranties and indemnities you agree to in a contract that go further than the law requires.
- Fines and penalties.
- Insolvency: losses from your own business failing.
- Unpaid fees: disputes over money clients owe you.
- Bodily injury and property damage not caused by your professional services: these fall under public liability.
- Cyber attacks and employment disputes: these need cyber and management liability cover.
- Cladding: some construction PI policies exclude claims involving non-compliant external wall cladding, and Victoria permits that exclusion for building practitioners.
Why Professionals Choose Coverscope
- Access to specialist PI insurers and underwriters through the Steadfast network
- Experience with engineers, designers and construction professionals, including state registration requirements
- Retroactive dates, run-off and limits set up correctly from the start
- Claims and notification support when a complaint or circumstance arises
Call 1300 900 207 or request a quote online.
Get in Touch
Simply fill in the form below and we’ll be in touch shortly, or feel free to call and tell us about your specific requirements.
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Suite 10B, Level 10, 2 Corporate Court, Bundall QLD 4217
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PO Box 7005, Mount Crosby QLD 4306
Our team continues to work remotely but you are welcome to arrange an appointment with one of our consultants.
Please complete the form to submit an enquiry.
