RICS secures new insurance terms, lifting the 12-month fire safety exclusion for PII

More chartered surveying firms will now be able to obtain improved fire safety cover in their professional indemnity insurance (PII).

The new Approved Minimum Wording and insurance rules coming into effect today, will mean that from 1 May, insurers must provide cover for fire safety claims on a property four storeys or less. Since 2020, insurers have imposed a blanket fire safety exclusion on PII terms provided due to concern following high profile fire safety failures, meaning chartered surveying firms have increasingly been left uninsured for fire safety exposure on all aspects of their business

Hugh Garnett, RICS Senior Policy Specialist comments: “In recent years, PII has become increasingly more expensive and difficult to secure, especially for smaller firms. In the past 18 months, we have seen increasingly stringent fire safety exclusions being placed on PII policies, reducing the protection for chartered surveying firms and the number of firms who have been able to offer professional advice on properties with fire safety issues.

Relief for surveyors unable to obtain fire safety cover

“The change in the approved minimum wording will provide a welcome relief to chartered surveyors who have been unable to obtain fire safety cover and will mean that firms renewing their PII policies from 1^st May will have greater coverage.

“We continue to work with Government and other industry stakeholders to find practicable and affordable solutions for the profession for properties over four storeys, with the Government’s commitment to developing an indemnity scheme for EWS1 completers.

“RICS professionals have a vital role to play in helping find resolutions and these new terms will mean firms are better protected for their work to navigate this current crisis.”

In addition, there is a new insurer requirement from the Prudential Regulation Authority for insurers to clarify cyber cover in PII policies.

RICS have also released a new guidance note: Risk, Liability and Insurance. The guidance note replaces the 2015 edition for valuers and provides advice to all regulated firms to understand and manage the main risks and liabilities associated with professional services provided by RICS members.

Hugh Garnett continues: “This guidance aids RICS regulated firms on some of the main risks and liabilities associated with surveying work. It also aims to further improve relationships between firms and clients as it sets out clearly where liabilities lie, creating greater transparency between the client and surveyor. This guidance will help professionals better understand the issues that can arise from providing professional services and take the appropriate steps to control and manage those risks and avoid litigation.”