Professional indemnity insurance and product liability insurance

Professional indemnity insurance

Professional indemnity insurance (PII) provides a professional person or business with an indemnity against claims or losses arising out of negligent acts, errors or omissions connected to the insured professional practice. PII also typically extends to the acts, errors and omissions of past employees. In construction projects, the most common risk that PII is intended to cover are claims arising out of the insured’s design responsibilities.

Any business that provides advice, consultancy or specialist services should consider whether it needs to take out PII cover.

Building contracts, professional appointments, sub-contracts and collateral warranties commonly require that PII is taken out and maintained by contractors, consultants and sub-contractors (as the case may be).

Guidelines and policy wording are produced by industry bodies, including the Architects Registration Board, Royal Institute of British Architects, Association for Consultancy and Engineering and Royal Institution of Chartered Surveyor. For some professions, ie architects, having PII in place is compulsory. While PII is not always compulsory, operating without PII is unthinkable because of their level of potential risk if problems occur and negligence claims are

To view the latest version of this document and thousands of others like it, sign-in with LexisNexis or register for a free trial.

TAKE A FREE TRIAL

Latest Construction News

Court of Appeal guidance on class actions, lead claims, global claims and disclosure (Alame v Shell)

Dispute Resolution analysis: The Court of Appeal has given guidance on the proper procedure for group litigation on environmental issues. Allowing the claimants’ appeal against a decision requiring the claim to be pleaded as a ‘global’ or ‘all-or-nothing’ claim, the court held this was a ‘paradigm example’ of litigation which should be progressed by lead cases. The court also highlighted the importance of disclosure in placing parties on an ‘equal footing’. While the court should be alert to disallow ‘fishing expeditions’ on disclosure, it is a powerful tool for achieving justice in cases where there is a significant asymmetry of information. Written by Harriet Campbell, senior knowledge lawyer at Penningtons Manches Cooper LLP.

Grenfell Tower Inquiry announces closure plans for early 2025

The Grenfell Tower Inquiry has announced details of its closure plans, set for January 2025. The Chairman is expected to formally conclude the Inquiry by writing to the Prime Minister, Sir Keir Starmer, confirming the completion of the Inquiry's Terms of Reference once all administrative tasks are finalised. The Inquiry's extensive record, including evidence provided to core participants, will be made available on the National Archives Discovery Platform in Q1 2025. The Inquiry's website will remain accessible until the end of February 2025, after which it will also be transferred to the National Archives. Final costs will be published upon closure, and the Inquiry has advised that its contact and press channels wil no longer be monitored regularly.

Welsh Government publishes guidance on KPIs under Procurement Act 2023

The Welsh Government has published technical guidance on key performance indicators (KPIs) as mandated by the Procurement Act 2023 and the Procurement (Wales) Regulations 2024, SI 2024/782. This guidance outlines the new legal requirements for Welsh contracting authorities to set, publish, and assess at least three KPIs for public contracts valued over £5m. It defines KPIs, provides an overview of the legal framework governing their use, and specifies the requirement to assess supplier performance against these indicators annually. The guidance also introduces a standardised rating system for performance assessment, clarifies the publication requirements for KPI-related information in various procurement notices, and highlights the potential consequences of poor performance, including new discretionary exclusion grounds.

GCF introduces new Procurement Specific Questionnaire

The Government Commercial Function (GCF) has unveiled a new Procurement Specific Questionnaire as part of its Procurement Pathway service. This questionnaire is designed to replace the Standard Selection Questionnaire previously used under the Public Contracts Regulations 2015 (PCR). The new tool aims to streamline the procurement process by enabling contracting authorities to obtain core supplier information from a central digital platform, along with additional exclusions, debarment information, and details relating to conditions of participation. The questionnaire is applicable across various stages of the procurement process, including business need definition, finalising and publishing procurement packs, supplier engagement, selection and clarification and due diligence. This development represents a significant update to the UK's procurement procedures, potentially simplifying and enhancing the efficiency of the supplier selection process.