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Understanding Professional Indemnity Insurance for Construction Professionals

As a construction professional, you need to make sure that you understand some of the key insurance policies which apply to you. One of the most important policies you need to understand is the professional indemnity clause, otherwise known as liability insurance.

What is Professional Indemnity Insurance?

Professional indemnity insurance protects you in the event that a former client loses money as a result of some negligence that occurred during your services. It can be used to cover legal fees and provide compensation to any aggrieved party; two events which could easily bankrupt a firm if allowed to run unchecked.

Instead of having to pay out thousands and potentially run your company into the ground, you can make a claim to your insurance provider to have them help with the costs. It is easily one of the most important insurance policies you will ever take out. Let’s take a look at some of the scenarios where you might require professional construction liability insurance.

Damaged Property

You have been brought in to oversee the refitting of windows around the house. In the middle of the job, one of your team’s toolboxes slips from their grasp and lands on the client’s tiled floor. Upon retrieving the toolbox, you see that the impact has cracked the tile.

A now furious client submits a bill to have the floor replaced. It might be an easy job, or the tiles could have been a rare import which are going to be very costly to replace. Either way, you have your liability insurance waiting to potentially help you out.

Flawed Design

While an architect may plan the building, it is down to you to build it correctly and to all safety specifications. If you pick up any flaws in the design then you should bring them to the attention of the architect before it is too late and the building is constructed.

Imagine this happens, and then a few years later the weak part of the building collapses. Even though the fault would technically lie with the architect, the client may come to you for compensation since you are the one who built the construction. In this scenario, professional liability insurance could help you with the legal fees you need to pay to defend yourself.

Accidents Onsite

You are showing a client around the construction site and, while you have gone over the Health and Safety guidelines with them, they still unfortunately manage to injure themselves. They blame you for negligence and sue you for the cost of their medical bills.

This is the perfect example of how professional liability insurance can help you. It is a life-saver and can help you even when you think you are not to blame.

If you have not yet invested in professional liability insurance then you should think about getting some immediately. It is one of the most important policies you as a company owner will ever take out. Don’t let one careless action cost you your business and your livelihood.

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