Checking professional indemnity insurance before appointing
Professional indemnity cover is claims-made, so today's certificate says little about the policy that will respond in eight years. Here is what to ask for and record.
Professional indemnity insurance is written on a claims-made basis, so the policy that responds to a defective ground investigation report is the one in force when the claim is notified, years after the work was done. That single feature explains why checking cover before you appoint matters, and why a certificate dated today tells you almost nothing about whether you will be paid in 2032.
For a developer commissioning eight or ten specialist reports on a major scheme, the insurance position is part of the appointment, and it takes twenty minutes to check properly.
Why cover matters on planning reports
Planning reports carry a long tail. A contaminated land assessment that misses a hotspot surfaces during groundworks. A transport assessment built on the wrong trip rates surfaces when the highway authority objects at appeal. An ecology report that missed a roost surfaces when the licence application fails and the programme slips a season.
The loss in those cases is rarely the fee. It is abortive design, delay, remediation and sometimes a lost permission, so a claim can be many multiples of what the report cost.
Insurers know that, which is why cover for the more exposed disciplines has become harder to place and why exclusions have crept into policies that used to be broad.
Limits, aggregation and run-off
Three features of the policy decide what you actually have.
The limit of indemnity is the maximum payable, and it is written either per claim or in the aggregate. In the aggregate means every claim in the policy year shares one pot, so a firm with a £2 million aggregate limit and three live claims may have very little left for yours. Ask which basis applies.
Aggregation clauses decide whether related problems count as one claim or several. A defect repeated across twelve plots may be treated as a single claim under one limit, which is worse for you than twelve separate claims, or as twelve, which is worse for the insurer. The wording matters and few clients ever read it.
Run-off cover applies after a firm stops trading. Because the policy is claims-made, a dissolved practice with no run-off cover leaves you with a claim against nothing. Ask what run-off arrangements exist, and for how long. Six years is a common answer, and it is shorter than the twelve-year limitation period that applies to appointments executed as a deed.
Check the excess as well. A large excess on a small firm can mean that the practice, rather than the insurer, has to find the first slice, and small practices sometimes cannot.
Liability caps in standard appointments
Most consultant appointments now cap liability. The cap is usually the lower of the level of insurance held or a stated sum, and it may be expressed as a multiple of the fee, which on a £6,000 ecology appointment is close to worthless against a season's delay.
Net contribution clauses are the other common limitation. They restrict each consultant's liability to their fair share of the loss, assuming every other party pays theirs, which shifts the risk of an insolvent co-consultant onto you.
Neither clause is unreasonable in itself. What matters is that the cap is proportionate to the exposure the report creates. A £250,000 cap on a report that could cost you a year of programme is a commercial decision you should make consciously rather than discover later.
| What to ask for | Why |
|---|---|
| Limit of indemnity, and whether per claim or aggregate | Tells you what is available if others have claimed |
| Renewal date and broker confirmation | A certificate expires, often within months |
| Confirmation the policy covers this discipline | Some policies exclude specific activities |
| Run-off arrangements | Claims-made cover fails if the firm closes |
| Excess level | A large excess can outstrip a small firm's resources |
| Sub-consultant arrangements | Their cover, or an extension of the lead's |
Where sub-consultants sit
Lead consultants routinely sub-let work. An acoustician subcontracts the vibration monitoring, an environmental consultant subcontracts the laboratory analysis, a planning consultant subcontracts a specialist chapter of an Environmental Impact Assessment.
Two arrangements are common. The lead carries the liability and insures the whole scope, or the sub-consultant is appointed directly and you take the risk of their cover. The first is simpler. The second often costs less and leaves you with more parties to chase.
Ask the lead which parts of the scope they intend to sub-let, whether their policy covers work carried out by others, and whether they will provide a collateral warranty. Where a funder or a purchaser is involved, warranties or third-party rights under the Contracts (Rights of Third Parties) Act 1999 will be needed anyway, and it is easier to agree them at appointment than after the report is issued.
What to request before instructing
Ask the broker rather than the consultant. A broker's letter confirming the limit, the basis, the renewal date and that the policy covers the specific services is worth more than a certificate emailed from a filing cabinet.
Then check the professional position alongside it. For report types where a licensed or competent person is legally required, insurance is necessary but not sufficient, and the licence or competence evidence is the thing that makes the report usable at all. The professional directory is one route to reviewers who can check or sign off a draft, and the report index sets out which types carry a professional requirement.
Where a report is drafted quickly and then reviewed, be clear about who carries the professional responsibility for the final document. The reviewer's insurance responds to what the reviewer signed, so the scope of that review has to be written down.
Recording the check in your files
Keep a one-page insurance register per project. Consultant, discipline, insurer, limit, basis, renewal date, cap in the appointment, date checked, who checked it.
Diarise the renewal dates. On a scheme running three years, a consultant's cover will renew two or three times, and cover can be reduced at renewal without anyone telling you.
That register is dull, and it is the document your solicitor will ask for the moment something goes wrong. Keep it with the appointments rather than in someone's inbox.
Illustrative example. A scheme of 90 homes appoints a ground investigation specialist whose policy carries a £1 million aggregate limit and a liability cap in the appointment set at the level of insurance held. Two years later, unexpected made ground is found across a third of the site, remediation runs to more than the cap, and the consultant has already notified an unrelated claim that year. The developer recovers a fraction of the loss. The figures are illustrative, and the pattern is not.
None of this replaces a proper conversation with your own broker. Insurance for construction and planning professionals moves with the market, and terms that were standard three years ago are not standard now.
For a scheme still at the scoping stage, work out which reports you need before you start collecting certificates. Enter the site postcode on PlanScope to see the likely list, then run the insurance check across the appointments that follow.
This is general guidance, not legal advice, and it is not insurance advice. Check policy terms and appointment wording with your broker or a qualified professional before relying on it.
PlanScope provides AI-assisted draft reports for planning applications. Reports should be reviewed before submission. We do not guarantee planning approval.
Frequently asked questions
What does claims-made cover mean?
The policy that responds is the one in force when the claim is notified, not the one in force when the work was done. A consultant who was well insured in 2026 may carry a lower limit, a new exclusion or no cover at all by the time a problem surfaces. That is why renewal dates and run-off arrangements matter as much as the current certificate.
Should the limit be per claim or in the aggregate?
Per claim is stronger for you, because each claim has its own limit. An aggregate limit is shared across every claim notified in the policy year, so a firm facing other claims may have little left. Ask which basis applies and record the answer, because the two look identical on a certificate at a glance.
What is run-off cover and why does it matter?
Run-off cover is professional indemnity insurance maintained after a firm stops trading, so that claims arising from past work still have a policy to respond. Without it, a claim against a dissolved practice has nothing behind it. Six years of run-off is common, which is shorter than the twelve-year limitation period applying to appointments executed as a deed.
Are liability caps in consultant appointments unreasonable?
Not in themselves. What matters is whether the cap is proportionate to the exposure the report creates. A cap expressed as a multiple of a small fee offers little against the cost of a season's delay or abortive design. Decide consciously whether to accept it, and price the residual risk rather than discovering it later.
Who insures work done by sub-consultants?
It depends on the arrangement. Either the lead consultant carries the liability and their policy covers work performed by others, or the sub-consultant is appointed directly and you rely on their cover. Ask which parts of the scope will be sub-let, whether the lead's policy extends to it, and whether collateral warranties will be provided.
Sources and further reading
This article is general guidance about the planning system in England and, where stated, the rest of the UK. It is not legal or professional advice. Check your local planning authority’s validation requirements and take professional advice for your specific site.