Late engineering claims can arise many years after the original professional services were provided.
Problems may only become apparent after construction, occupation, later alterations or a subsequent investigation.
This is one reason Professional Indemnity Insurance for engineers is commonly arranged on a claims-made-and-notified basis rather than by reference only to when the original work was performed.
When a later claim arises, the relevant policy position can depend on matters such as:
- the policy in force when the claim is made
- whether relevant facts or circumstances were notified earlier
- the retroactive date
- continuity of cover
- prior-known-circumstance provisions
- the exact policy wording
A lapse in cover can therefore create problems even where the engineering work was completed years earlier.
Engineering firms should also retain appropriate project and insurance records because a later claim may require evidence of what work was performed, when it was completed and what insurance arrangements applied at the time.
