Professional indemnity, and why it is claims-made
Every other insurance you hold responds to when the event happened. This one responds to when the claim arrives, and that changes what happens when you stop paying for it.
QScope Team · 6 February 2026 · 4 min read
Professional indemnity insurance covers the consequences of professional negligence: advice that was wrong, a design that failed, a valuation that was overstated. Every consultant carries it, and most construction contracts and appointments require a stated level to be maintained for a stated period.
Claims-made, not occurrence-based
This is the point that matters and it is not intuitive. Most insurance responds to when the event happened. PI responds to when the claim is made.
Advice given in 2020 and challenged in 2026 is covered by the policy in force in 2026, not the one in force in 2020. If there is no policy in 2026, there is no cover, regardless of how conscientiously the premiums were paid at the time.
Run-off
Which is why run-off cover exists. A practice that closes, merges or retires needs to keep a policy running for the limitation period, six years for a simple contract and twelve for a deed.
Run-off is a real cost and it is the one most often forgotten in the arithmetic of closing a practice. It is also the reason appointments frequently require cover to be maintained for a set number of years after completion, rather than merely during the work.
Aggregate and each and every
A limit expressed as each and every claim gives that amount per claim. A limit expressed in the aggregate gives that amount across the whole policy year, shared between however many claims arrive.
A contract requiring two million pounds of cover is satisfied by either, and they are very different things. Where the requirement is silent, it is worth being explicit.
Exclusions worth knowing about
- Fitness for purpose. PI covers negligence, meaning a failure to exercise reasonable skill and care. It does not cover an absolute obligation that the work will be fit for purpose. Signing an appointment containing one can void cover on that point.
- Fire safety and cladding. Widely excluded or heavily restricted since 2018. Check rather than assume.
- Net contribution. Not an exclusion, but it limits recovery to a fair share.
The practical habit
Ask for the certificate at appointment, not at completion. Diary the renewal date of anyone whose warranty you hold. And read your own appointment for absolute obligations before signing it, because the clause that voids your cover is usually one sentence long and looks reasonable.
QScope records the PI schedule on the project register alongside the warranties it usually stands behind.