Professional Indemnity Update

Government moves to ease restrictions on professional indemnity insurance

In August last year, building surveyors and inspectors were permitted to hold policies with exclusions, following a tightening of the insurance market.

Since this time, the market has continued to deteriorate, with underwriters extending exclusions for external wall cladding products to policies covering engineers and other industry professionals.

As a result, commencing on 15 February 2020, the Victorian Building Authority now allow all classes of engineers, draftspersons and quantity surveyors to temporarily operate with cladding exemptions on their professional indemnity (PI) policies.

The move means building industry professionals will no longer need to hold exclusion-free PI insurance when applying for or renewing their registration.

The temporary measure is aimed at averting a potential shutdown of the state’s construction sector, which like the rest of the country has been caught up in the fallout from the PI crisis.