Home / Local / Insurers reject idea to downgrade PI for surveyors
20 April 2020
Mandatory professional indemnity (PI) insurance “remains necessary” for surveyors and other building industry professionals, the Insurance Council of Australia (ICA) says, rejecting a suggestion that it should be removed.
Building industry regulation expert Bronwyn Weir says governments should consider removing the requirement for licensed surveyors to hold PI insurance. She told insuranceNEWS.com.au last week her suggestion is “quite drastic” but “it kind of gives a reset” to the insurance crisis facing surveyors.
Ms Weir flagged 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.
But ICA says the solution is to implement every of the 24 recommendations made by Ms Weir and Peter Shergold in their Building Confidence report that was submitted to governments in 2018.
Governments at the state and federal levels agreed last year to adopt the report’s proposals, which addressed building industry shortcomings.
“ICA believes compulsory professional indemnity insurance remains necessary for building industry professionals,” spokesman Campbell Fuller told insuranceNEWS.com.au.
He says Ms Weir’s suggestion “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,” Mr Fuller said “Current policy restrictions are likely to remain in place until insurers have evidence that their concerns have been resolved.”
Ms Weir says the higher excesses and list of exclusions have combined to produce a “highly compromised” PI product that offers little protection.
“I don’t doubt for a minute [surveyors] 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.”