Insurance Requirements for Civil Engineers & Technical Consultants (UK Guide)

Introduction

Civil engineers and technical consultants sit at the centre of high-value, high-risk projects. A single design assumption, calculation error, specification change, or missed compliance detail can trigger delays, remedial works, injury, property damage, or disputes over who should pay. That’s why “having insurance” isn’t just a box-tick. The right programme protects your balance sheet, helps you win work, and gives clients confidence that you can respond if something goes wrong.

This guide explains the main insurance covers civil engineers and technical consultants typically need in the UK, what clients and contracts often require, and how to avoid common gaps.

Why insurance matters in engineering consultancy

Engineering consultancies face a mix of professional and operational exposures:

• Professional risk: advice, designs, calculations, reports, surveys, specifications, project management decisions.

• Third-party liability: injury or property damage arising from site visits, meetings, or your office operations.

• Employer risk: staff injuries, illness, stress claims.

• Contractual risk: indemnities, fitness for purpose, collateral warranties, net contribution clauses.

• Technology risk: data loss, ransomware, email interception, fraudulent payment instruction.

Even if you’re a small practice, your work can sit inside large projects where losses escalate quickly.

The “core” policies most civil engineers and consultants need

1) Professional Indemnity (PI) Insurance

What it covers PI is the cornerstone for civil engineers and technical consultants. It typically covers legal defence costs and compensation arising from allegations of:

• Negligent advice or design

• Errors or omissions in calculations, drawings, specifications, reports

• Breach of professional duty

• Misrepresentation (often limited)

• Infringement of intellectual property (sometimes limited)

Why clients insist on it PI responds to the losses that are most likely to be attributed to a consultant: design defects, incorrect recommendations, or failures to meet professional standards.

Typical contract requirements Clients often specify:

• Limit of indemnity (e.g., £1m, £2m, £5m, £10m)

• Basis: “any one claim” vs “aggregate”

• Retroactive date (or “full retro”)

• Run-off period after completion (commonly 6–12 years)

Any one claim vs aggregate

• Any one claim: the limit applies to each claim (subject to policy terms). Often preferred on higher-risk work.

• Aggregate: one pot for the policy year. Multiple claims can erode the limit.

Key PI features to check

• Civil liability wording (broad) rather than narrow “negligence only” wording.

• Contractual liability extensions (limited) for standard forms.

• Fitness for purpose exclusions (common) and how your contracts are drafted.

• Collateral warranties / third-party rights: are they covered, and on what terms?

• Sub-consultants: are you responsible for their work? Are they required to carry their own PI?

• Joint ventures: do you need a separate JV policy?

Common PI exclusions and pitfalls

• Known circumstances: anything you were aware of before inception/renewal.

• Fitness for purpose obligations: if your contract promises an outcome rather than reasonable skill and care.

• Pollution and contamination: often restricted; may matter for groundworks, remediation advice, drainage, or flood work.

• Asbestos: frequently excluded.

• Fire safety / cladding: some markets restrict certain construction-related risks.

• Design and build exposures: if you take on responsibilities beyond consultancy.

2) Public Liability (PL) Insurance

What it covers Public liability covers your legal liability for third-party:

• Bodily injury

• Property damage

arising from your business activities (e.g., a site visit incident, a client trip hazard at your office, accidental damage to a client’s property).

Typical limits Common limits are £2m, £5m, or £10m, depending on client requirements and the nature of your site work.

PL vs PI (the key difference)

• PI: financial loss arising from professional services.

• PL: injury/property damage arising from accidents.

A design error causing rework is usually PI. A site visit incident causing injury is usually PL.

3) Employers’ Liability (EL) Insurance

Is it required by law? In most cases, yes. If you employ staff in the UK (including many part-time and casual arrangements), you typically must have employers’ liability insurance with a minimum limit of £5m (most policies provide £10m).

What it covers Claims from employees who suffer injury or illness arising from their work, including:

• Slips/trips during site visits

• Manual handling injuries

• Stress-related claims

• Occupational illness

Even office-based consultancies can face EL claims.

Additional covers that are often essential

4) Contractors’ All Risks (CAR) / Site Works cover (when applicable)

Many consultancies don’t need CAR because they’re not physically carrying out works. But if you do any enabling works, temporary works installation, or you’re responsible for certain on-site activities, you may need:

• Contract works cover (damage to works in progress)

• Tools and equipment

• Hired-in plant

If you’re purely advisory, you may still need to check contracts for “principal designer” or site responsibilities that could create operational exposures.

5) Management Liability (Directors’ & Officers’ / Management Risks)

If you’re a limited company, management liability can protect directors and the business against claims alleging wrongful acts in management, including:

• Employment practices claims

• Regulatory investigations (limited)

• Breach of duty allegations

This is particularly relevant as consultancies grow and hire.

6) Cyber Insurance

Engineering consultancies are attractive targets because they hold:

• Project documents and drawings

• Client contact details

• Payment information

• Sensitive infrastructure and site data

Cyber can cover:

• Ransomware response and business interruption

• Data breach response costs

• Third-party liability

• Cyber extortion

• Funds transfer fraud (sometimes optional)

Cyber is increasingly requested by larger clients and supply chains.

7) Professional Indemnity “run-off” cover

If you stop trading, retire, or sell the business, your PI exposure doesn’t disappear. Claims can arise years later.

Why run-off matters PI is typically written on a claims-made basis, meaning the policy in force when the claim is made (and notified) responds, not the policy in force when the work was done.

Many contracts require 6 or 12 years of PI run-off, aligning with limitation periods and deed contracts.

8) Office insurance (property, contents, business interruption)

If you have premises or valuable equipment:

• Office contents (IT equipment, survey kit)

• Business interruption (loss of income after an insured event)

• Portable equipment cover for laptops and devices

Contract and compliance considerations (UK)

Standard of care: “reasonable skill and care” vs “fitness for purpose”

Most PI policies are designed around a professional negligence standard: reasonable skill and care. If you accept a fitness for purpose obligation (common in some design-and-build or bespoke contracts), you may create an uninsured exposure.

Practical tip: ask for contract wording to be aligned to “reasonable skill and care” and include a net contribution clause where appropriate.

Collateral warranties and third-party rights

On construction projects, you may be asked to provide collateral warranties to funders, purchasers, tenants, or other parties. This expands who can sue you.

Check:

• Whether your PI policy allows warranties

• Any restrictions on the form of warranty

• Whether the warranty creates fitness for purpose obligations

Limitation of liability and caps

Many consultancies negotiate caps (e.g., to the PI limit or a fixed amount). Insurers generally prefer caps that are clear and aligned to your PI limit.

Principal Designer duties (CDM Regulations)

If you act as Principal Designer under CDM, your responsibilities increase. Make sure your PI proposal and policy reflect:

• The nature of your CDM services

• The project types and values

• Any higher-risk sectors

How to choose the right PI limit (practical approach)

There’s no universal “required” limit, but you can make a sensible decision by looking at:

• Client contract requirements (often the starting point)

• Project values and the potential cost of remedial works

• Your role (lead designer vs specialist sub-consultant)

• Worst-case scenario: delay claims, rework, third-party claims

• Number of projects live at once (aggregate risk)

A small consultancy working on high-value infrastructure may need a higher limit than a larger firm doing low-risk advisory work.

Common scenarios and which policy might respond

• Incorrect calculation leads to foundation redesign and delay: typically PI.

• Survey equipment damages client property on site: typically PL (or equipment cover for your kit).

• Employee injured during site inspection: EL.

• Email account compromised and fraudulent bank details sent to a client: cyber (funds transfer fraud extension may be needed).

• Allegation you failed to warn about a foreseeable safety risk: PI (and possibly management liability depending on allegations).

What insurers will ask you (and how to prepare)

When arranging PI and related covers, expect questions on:

• Turnover (overall and by discipline)

• Fee income split (civil engineering, structural, project management, surveying, etc.)

• Largest contract value and typical project size

• Contract terms used (NEC, JCT, bespoke)

• Use of collateral warranties

• Quality control: checking procedures, peer reviews, sign-off

• Claims history and known circumstances

• Sub-consultant controls

• Overseas work (including US/Canada exposures)

Having clear processes and documented QA can materially improve terms.

Practical risk-management tips to reduce claims

Good insurance is essential, but insurers also reward good risk management:

• Use written scopes of work and confirm assumptions

• Control changes: document variations and approvals

• Keep version control on drawings and reports

• Use peer review for calculations and critical designs

• Maintain site visit records and photos

• Avoid promising outcomes; stick to reasonable skill and care

• Review contracts for indemnities and warranty obligations

• Train staff on cyber hygiene and payment verification

FAQ

Do civil engineers legally need professional indemnity insurance?

There’s no single UK law that forces every civil engineer to hold PI, but in practice it’s often required by clients, frameworks, and professional expectations. If you provide advice or design services, PI is usually essential.

What PI limit do clients typically require?

It varies. Many commercial clients ask for £1m–£5m, while larger infrastructure or higher-risk projects may require £10m or more. The right limit depends on project value, your role, and contract wording.

How long do I need PI run-off after a project ends?

Commonly 6 or 12 years, especially where contracts are executed as deeds or where collateral warranties are involved. Always check your contract requirements.

What’s the difference between PI and public liability?

PI covers financial loss from professional services (advice, design, errors/omissions). Public liability covers injury or property damage from accidents.

If I’m a sole trader with no employees, do I need employers’ liability?

Often no, but it depends on your working arrangements (e.g., labour-only subcontractors can trigger EL requirements). It’s worth checking your specific setup.

Does PI cover subcontractors?

Sometimes, but not automatically. Many policies require sub-consultants to carry their own PI. If you’re responsible for their work under contract, you must disclose this and ensure the policy structure matches.

Will PI cover fitness for purpose obligations?

Usually not. Most PI policies are designed for negligence-based claims. If your contract includes fitness for purpose, you may need to renegotiate the wording.

Do I need cyber insurance if I’m a small consultancy?

Yes, it’s increasingly relevant. Smaller firms can be targeted because they have weaker controls, and they still hold valuable project and client data.

Next steps

If you’re a civil engineer or technical consultant, the safest approach is to align your insurance programme with your contracts and your real-world exposures. Start with PI, PL, and EL, then add cyber and management liability based on your operations and client expectations.

If you want, share the types of projects you work on (e.g., highways, drainage, temporary works, geotechnical, project management) and typical contract values, and I’ll tailor a “minimum recommended” insurance checklist you can use when requesting quotes.