Project-Specific Professional Indemnity (SPPI) Explained
Project-specific professional indemnity, also called single project professional indemnity (SPPI), is a long-term professional indemnity policy placed for one construction project, covering the parties engaged in delivering it. It covers them for the duration of the project and beyond, typically for up to 10 years, and isn’t subject to annual renewal once it’s placed. A project contract may require it.
For the full picture of insurance for project managers, including how much annual PI cover you need, see our project management insurance page.
How Project-Specific PI Differs from Annual PI
| Annual professional indemnity | Project-specific professional indemnity | |
|---|---|---|
| What it covers | Claims made during the policy year about your professional work, back to your retroactive date | Professional services on one construction project only |
| Policy period | One year at a time | The project and beyond, typically up to 10 years |
| Renewal | Renews each year | Placed once, with no annual renewal |
| Who it covers | Your business, its directors, partners and employees | Multiple parties engaged in delivering the project, as set out in the policy |
Why Is Project-Specific PI Used?
With annual PI, each party’s cover for a project depends on that party renewing its own policy every year. A single project policy works differently. Once it’s placed, it isn’t conditional on annual renewals or on claims performance, so cover for the project continues for its full term. That certainty for everyone involved in the project is its main benefit.
When Is Project-Specific PI Used?
It’s used for construction projects, either because the project contract requires it or because the parties delivering the project want cover that lasts for the whole project and beyond. Several Australian underwriters offer single project PI.
Do You Still Need Annual PI?
If you do other work, yes. A project-specific policy only covers the named project, so your annual professional indemnity is still what covers the rest of your work. Tell us about the project-specific policy, so we can check how it and your annual policy fit together.
How to Arrange Project-Specific PI
- Read the insurance clause before you sign, and check the required limit and how long cover must last after completion.
- Confirm who’s responsible for arranging the policy, so it isn’t missed or doubled up.
- Send us the contract and the project details. We arrange single project PI through specialist Australian underwriters, and check how it fits with your annual cover.
What is project-specific professional indemnity insurance?
A long-term professional indemnity policy placed for one construction project, covering the parties engaged in delivering it for the duration of the project and beyond, typically up to 10 years. It’s also called single project professional indemnity, or SPPI.
Is project-specific PI the same as annual PI?
No. Annual PI covers claims made during each policy year about your professional work, and renews each year. Project-specific PI covers one construction project only, and once it’s placed it isn’t renewed annually.
Do I need project-specific PI as well as my annual policy?
Only when a project calls for it, either through the contract or because the parties want cover for the whole project. When it does, we arrange the project policy and your annual PI still covers your other work, so keep it in place.
When do you need project-specific PI?
When a construction project contract requires it, or when the parties delivering a project want cover that lasts for the whole project and beyond, without relying on each party’s annual renewals.
Does project-specific PI cover development managers?
It can cover the parties engaged in delivering the project, which can include development and project managers, depending on how the policy is arranged. The contract and policy wording set out exactly who’s covered.
Talk to Us About Project-Specific PI
We arrange single project professional indemnity through specialist Australian underwriters. If a contract asks for it, send it to us before you sign. Call 1300 900 207, or visit our project management insurance page.
Important Information
This article is general information only and isn’t personal advice. It doesn’t take into account your objectives, financial situation or needs. Policy terms, conditions, limits and exclusions vary between insurers, so read the relevant Product Disclosure Statement (PDS) and Target Market Determination (TMD) before deciding whether a policy is right for you, and speak with us about your circumstances.
