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What is Professional Indemnity (PI) Insurance?

Under certain conditions, PI insurance may provide financial protection and cover the costs in the event of a claim where a client (or another person) experiences financial loss as a result of a contractor’s alleged errors or omissions.

Who needs PI?

If you are applying for or hold an existing contractor licence in certain licence classes, you are required to hold the appropriate level of PI insurance cover. The Financial Requirements for Licensing provides information on the licence classes that require PI and the indemnity amount required for each of those classes.

If you don’t provide proof of current PI Insurance (originals or copy) or an exemption request at the time of your renewal or when otherwise requested, your licence may be suspended or cancelled.

How do I get PI Insurance?

Contact an insurance broker.

Acceptable evidence of cover

Applying for a PI exemption

In certain circumstances, you may be entitled to apply for an exemption from holding PI. To apply, complete the Declaration – Professional Indemnity Insurance form and provide evidence that:

  • PI is not available in the market place, or;
  • it is economically unviable for you to obtain PI

If an exemption is granted, we may place a condition on your licence. You’ll be required to give your clients a notice in writing (clause in a contract or by a separate notice), stating you do not hold PI Insurance.

Note: you don’t need to provide PI if you hold a Nominee Supervisor, Site supervisor or Fire Protection occupational licence.

Exemption from providing financial documentation by holding PI

In certain circumstances, you may be exempt from providing financial information.

If you apply for or hold a contractor licence in any of the following licence classes, and you meet the relevant conditions, you can provide evidence of your current PI Insurance and a completed Estimated Annual Turnover declaration instead of providing financial information:

  • Builder Project Management Services
  • Building Design Low Rise
  • Building Design Medium Rise
  • Building Design Open
  • Hydraulic Services Design
  • Hydraulic Services Design (excluding design of on-site domestic waste water management)
  • Site Classifier
  • Site Classifier (excluding on-site domestic waste management)

You are not eligible for this exemption if you already hold, or are applying for, a contractor licence in a class other than those mentioned directly above e.g. you hold or are applying for a Carpentry contractor licence.

What if I have been granted a PI Exemption?

You must provide the relevant financial information.

Licence
Creative Commons Attribution 3.0 Australia (CC BY 3.0)
Last updated
17/03/2014 3:11 PM

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