Building industry regulation expert Bronwyn Weir has suggested governments consider removing the requirement for licensed surveyors to hold professional indemnity (PI) insurance.

Ms Weir, co-author of the Building Confidence report, flags the idea in a LinkedIn post where she says the long-running issues of massive increases in premiums and excesses are no longer tenable for surveyors.

Instead of mandatory PI, she believes a “voluntary” approach may offer a way out of the insurance crisis.

She says her suggestion is “quite drastic” but believes “it kind of gives a reset” to the situation, which has forced governments to temporarily allow surveyors to operate with PI cover that comes with many exemptions, including cladding.

“Surveyors will want insurance – I don’t doubt for a minute they won’t want to be insured,” Ms Weir told insuranceNEWS.com.au. “I think it’s a different landscape if surveyors don’t have to hold these products.

“If they are in a market where they are negotiating and it’s voluntary, it does shift the relationship with the insurer. It might just shake it up and offer a new horizon for what insurance products could be available if it was a voluntary basis.

“Over time, I think this is a potential reset that is better than the current option where they have to buy it.”

Ms Weir says the higher excesses and list of exclusions have combined to produce a “highly compromised” PI product that offers little protection.

“Because of the size of excesses under these newer policies, the building surveyors will effectively be self-insuring,” she writes in her LinkedIn post. “One or maybe two claims will send most businesses into insolvency, meaning consumers will not be able to make claims at all.”

But surveyors and the Insurance Council of Australia (ICA) think otherwise. They say implementing all the recommendations made by Ms Weir and Peter Shergold in the Building Confidence report is the solution to the insurance crisis.

Governments at the state and federal levels have already agreed to adopt the report’s proposals, which addressed building industry shortcomings.

ICA spokesman Campbell Fuller says Ms Weir’s LinkedIn post “highlights the lack of meaningful progress in resolving the building industry crisis through implementing all recommendations from the [Building Confidence] report”.

“Piecemeal action and promises are not enough,” he told insuranceNEWS.com.au. “Current policy restrictions are likely to remain in place until insurers have evidence that their concerns have been resolved.”

The Australian Institute of Building Surveyors says Ms Weir has raised one possible option, but its preferred approach is for all building professionals, including registered builders, to carry mandatory PI insurance.

“In this way, consumer protection would be maintained and the premium pool increased, making the industry more attractive to insurers by spreading the risk,” CEO Brett Mace told insuranceNEWS.com.au.

“The whole industry is now paying the price for government delay following the release of the Building Confidence report recommending all building professionals be registered.”

Click here to read Ms Weir's LinkedIn post.