There is no single Professional Indemnity Insurance limit that is suitable for every building inspector. The appropriate limit will depend on the services provided, where the inspector operates and the potential financial consequences of an error or omission.

Webber Insurance has a specialist insurance facility for Building Inspectors. Eligibility, available limits and policy terms depend on the inspection services provided, experience and any licensing or registration requirements.

When selecting a limit, consider:

• The types of inspections and reports provided
• The value and complexity of the properties inspected
• The number of inspections completed each year
• Whether advice is provided on structural, compliance, safety or specialist matters
• Licensing and registration requirements
• Professional association requirements
• Limits required under client contracts
• Whether defence costs are included within or paid in addition to the limit
• The number of claims that could arise during one policy period

Some state requirements apply to particular licensed or registered activities:

• Queensland: A person holding a completed residential building inspection licence must maintain at least $1 million of Professional Indemnity Insurance for any one claim and in total during the policy period. The policy must also meet the other standards prescribed by the QBCC. Current information is available from the Queensland Building and Construction Commission.
• Victoria: Registered building inspectors must hold Professional Indemnity Insurance. The current Ministerial Order requires at least $1.5 million where defence costs are included within the limit, or at least $1 million for claims plus $500,000 for defence costs where defence costs are provided separately. The policy must also satisfy other requirements in the Victorian Ministerial Order.

These legal requirements apply to specific licence or registration categories. They do not necessarily apply to every person offering pre-purchase, handover, pest or other property inspection services.

Even where there is no prescribed minimum, a client, professional association or contract may require a particular limit. A regulatory minimum should also not automatically be treated as the recommended limit for every business.

Before accepting a contractual insurance requirement or selecting your limit, contact Webber Insurance on 1300 932 237. We can review your services, existing cover and the requirements applying to your work.