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Professional indemnity insurance changes

January 27, 2020

The Victorian government has changed the rules for professional indemnity insurance required for registration by quantity surveyors, engineers, draftspersons and architects. These changes correspond to changes made to the rules for building surveyors and building inspectors last year. These changes have no direct impact on builders as they do not have to hold, and cannot obtain, professional indemnity insurance. It is important for builders to however be aware of the changes.

The rule change has been made to ensure that building professionals remain eligible for registration. Without the change many building professionals may not have been able to obtain professional indemnity insurance that complied with the registration requirements and they could have been forced to cease trading.

The change allows for professional indemnity insurance for building professionals to exclude claims that relate to or are in connection with non-compliant external wall cladding products supplied and or installed on buildings. This would mean that if the building professional is sued in the future their insurer may be able to avoid responsibility for the claim.  Instead the building professional would be directly liable to pay if they were found to be legally responsible. This makes their financial exposure to cladding claims similar to builders.

Read the relevant government gazette notice.

For further information, please call HIA Workplace Services on 1300 650 620.