Professional Indemnity Insurance for advisory and design firms
Professional indemnity insurance protects your firm when a client claims your advice, design or service was negligent and cost them money. Specialist brokers compare PI for consultancies, design teams and contractors.
- Civil liability cover for advice, design and services
- Limits set to suit contracts and professional bodies
- Claims made cover, with run-off when needed
Reviewed October 2026 by the MyBusinessComparison.com editorial team
What is professional indemnity insurance?
Professional indemnity insurance protects your firm against claims that a mistake, oversight or negligent advice in your professional work caused a client or third party financial loss. It pays compensation and defence costs, and many policies also cover breach of confidence, defamation and lost client documents.
Unlike most liability cover, PI is written on a claims made basis. The policy that pays is the one in force when the claim is first made against you, not when the work was done, so cover needs to run without a break. When a firm stops trading, is sold or changes what it does, run-off cover protects it against claims about past work.
Many professional bodies set minimum PI terms for their members, and clients increasingly write a specific limit into contracts. Each policy also has a retroactive date: work done before it may not be covered, so it is worth keeping that date unchanged when moving insurer.
Professional indemnity insurance in brief
- Covers
- Financial loss caused by negligent advice, design or services
- Claims basis
- Claims made: the policy in force when the claim arrives responds
- Limit basis
- Each and every claim or aggregate, depending on the policy
- Compulsory?
- For some professions, through their professional body; often required by contract
- Priced on
- Fee income, services provided, contract terms and claims history
- Key dates
- The retroactive date and the date circumstances were notified
What professional indemnity insurance covers
Many PI policies are now written on a civil liability basis, which is broader than negligence alone. These are the main areas of cover.
Negligent advice and services
Errors, omissions and poor advice that leave a client out of pocket, such as a flawed survey, a missed deadline or a wrong calculation.
Design and specification errors
Claims that drawings, specifications or calculations were wrong, including design carried out by contractors under design and build contracts.
Read more about insurance for construction companies
Breach of confidentiality
Accidental disclosure of a client's confidential information through your staff, your systems or a misdirected email.
Read more about cyber insurance
Defamation and intellectual property
Unintentional libel, slander and infringement of copyright or trade marks in reports, content and designs you produce.
Lost documents and data
The cost of replacing or restoring client documents and records that are lost or damaged while in your care.
Dishonest employees
Claims from clients who suffer loss because one of your staff acted dishonestly, as long as the firm's principals were not involved.
Read more about crime and fidelity insurance
Defence and disciplinary costs
Legal fees to defend claims and, in many policies, representation at disciplinary hearings brought by your professional body.
Circumstances notified in time
Incidents reported during the policy year that might lead to a claim stay with that policy, even if the claim itself arrives later.
Covers PI firms often add
- Public liability: injury and property damage claims, which most PI policies exclude
- Cyber: data breaches, ransomware and downtime affecting your own systems
- Directors' and officers': personal cover for directors facing claims about how the firm is run
- Office insurance: contents, IT equipment and the premises your team works from
- Legal expenses: fee recovery and contract disputes that PI will not fund
Who needs professional indemnity insurance?
Any firm paid for its expertise, judgement or design. These are the sectors where PI is most often required or expected.
Need technology PI? Software and IT firms often combine PI with cyber cover. See technology company insurance or browse insurance by industry.
- Consulting and structural engineers: calculations, specifications and site supervision where errors are very costly to put right
- Design and build contractors: contractor design responsibility, often with fitness for purpose obligations in the contract
- Civil engineering consultancies: infrastructure, drainage and highways design for public and private clients
- Property developers: design responsibility kept in house or passed to consultants, plus collateral warranties to buyers and funders
- Software and IT businesses: systems that fail, projects that overrun and data that is lost, often written as technology PI
- Recruitment agencies: unsuitable placements, incomplete checks and breach of confidentiality
- Accountants, surveyors and consultants: advice and reports that clients rely on to make financial decisions
- Healthcare businesses: advisory and administrative work, with treatment risks placed under medical malpractice insurance
- Electrical and building services contractors: mechanical and electrical design, energy assessments and commissioning advice
- Fire and security alarm installers: system design and specification, where a failure to operate can lead to large losses
How much does professional indemnity insurance cost?
PI is priced on how much clients rely on your advice and how badly it could go wrong. Insurers weigh these factors most.
Fee income
Most insurers rate on the fees you earn, split by service and by where clients are based. Bigger fees usually mean bigger projects and bigger potential claims.
Services you provide
Structural design, financial advice and fire safety or cladding work carry far more weight than general consultancy or training.
Limit and its basis
An each and every claim limit costs more than an aggregate one, and whether defence costs erode the limit also affects the price.
Contracts you sign
Fitness for purpose obligations, uncapped liability and long collateral warranties increase exposure. Insurers like to see a contract review procedure.
Claims and circumstances
Previous claims, notified circumstances and complaints all matter, as does what the firm changed afterwards.
Qualifications and controls
Staff qualifications, peer review, file management and supervision of junior staff count, particularly for design work.
What professional indemnity insurance does not cover
PI exclusions vary sharply between insurers. These are the ones that come up most often.
- Claims or circumstances you knew about before the policy started
- Work carried out before the retroactive date on your schedule
- Injury and property damage, which usually belong under public liability insurance
- Fitness for purpose obligations and warranties beyond reasonable skill and care
- Fines and penalties, and liquidated damages beyond what you would owe without the contract clause
- Claims brought in the USA or Canada, unless agreed
- Your firm's own trading losses or insolvency
- Cladding and fire safety work, which many insurers now restrict or exclude
Professional indemnity or public liability?
Firms often assume one covers the other. They respond to different kinds of loss, and many businesses need both.
| Feature | Professional indemnity | Public liability |
|---|---|---|
| What triggers a claim | Negligent advice, design or service | Accidental injury or property damage |
| Type of loss | Mainly financial loss to a client | Physical harm to people or property |
| Claims basis | Claims made: the policy in force when the claim arrives | Occurrence: whichever policy was live when the incident took place |
| Typical claim | A design error means a finished building must be altered | A visitor trips over cables in your office |
| Usually rated on | Fee income and services provided | Turnover or wage roll and activities |
| After you stop trading | Run-off cover is needed for past work | Past policies continue to respond |
How to compare professional indemnity cover
PI proposals are detailed. Preparing the following saves time and gives insurers fewer reasons to load terms.
Describe your services precisely
Break fees down by discipline and project type, and highlight any specialist or higher risk work.
Review your contracts
Note the PI limit and basis clients ask for, any fitness for purpose obligations and any collateral warranties.
Set out claims and circumstances
Include notified circumstances and complaints as well as claims, with what has changed since.
Confirm your retroactive date
Check the date on your current schedule and make sure any new policy continues it.
Compare the detail
Look at the limit basis, whether costs are inclusive, excesses, exclusions for your type of work and run-off terms.
Contract asking for PI?
Tell us about your services and fee income and a specialist broker will compare PI cover for you.
Compare quotesProfessional indemnity insurance FAQs
How much does professional indemnity insurance cost?
It depends on your fee income, the services you provide, the limit and its basis, your contract terms and your claims history. A structural engineer and a management consultant with similar fees will be quoted very differently. A broker can point to the parts of your work that drive the premium.
Is professional indemnity insurance compulsory?
Not for every business, but many professional bodies, including those for accountants, surveyors, architects and solicitors, require members to hold it on set terms. Clients and public sector frameworks also commonly make it a condition of appointment.
What does claims made mean for PI?
It means the policy in force when a claim is first made against you is the one that responds, regardless of when the work was done. If cover lapses, claims about earlier work may not be covered, which is why PI is usually kept in place continuously.
What is run-off cover?
Run-off cover protects a firm against claims about past work after it stops trading, is sold or merges. Because PI is claims made, a claim arriving after the policy lapses would otherwise be uninsured. Some professional bodies require run-off for a set number of years.
What is the difference between each and every claim and aggregate limits?
An each and every claim limit applies in full to every separate claim in the year. An aggregate limit is the most the insurer will pay for all claims in the year combined. Contracts often state which basis they expect, so it is worth checking before you sign.
Do I need to tell the insurer about a possible claim?
Yes, as soon as you become aware of circumstances that could lead to a claim. Notifying promptly ties the matter to the current policy, even if the claim arrives years later. Late notification is a frequent cause of disputes over PI claims.
Does PI cover design work by a contractor?
It can. Contractors who design under design and build contracts need PI for that responsibility, because public liability will not pay for a design that is simply wrong. Fitness for purpose obligations are usually excluded, so check what your contracts ask of you.
Is professional indemnity the same as directors' and officers' insurance?
No. PI covers claims that the firm's professional services caused a client loss. Directors' and officers' insurance covers individual directors for claims about how they managed the company, such as decisions affecting shareholders, creditors or employees.
How do I get a professional indemnity insurance quote?
Fill in the short form here and a broker who places PI for professional firms will follow up. Have your fee income by service, a description of your work, recent contract requirements, your current retroactive date and details of any claims or notified circumstances ready.
Compare professional indemnity cover for your firm
PI matched to your contracts, your professional body's terms and the services you provide, arranged by specialist brokers.