More than one in 10 of Australia’s consulting engineers have no professional indemnity insurance. A survey compiled by the Association of Consulting Engineers of Australia (ACEA) has found that 11% of its members have reacted to soaring liability premiums by carrying the risk themselves.

Member firms carrying uninsured risk and liability will undoubtedly face bankruptcy if they are hit by a claim, according to ACEA Executive Director Therese Charles. “There is absolutely no doubt there now exists clear-cut market failure in professional indemnity.”

The survey revealed that more than 50% of the survey respondents recorded an increase of 50%-plus in PI premiums.

More than 70% of the engineers’ PI business was placed through brokers.

Ms Charles said the ACEA will now have to consider its mandatory insurance requirements, with the option of either lowering the requirement or getting rid of it altogether. 

She said “many communities” will be impacted in a variety of ways as professionals find themselves to offer their specialist services.