Professional Indemnity Insurance in the UAE

Professional Indemnity Insurance, also known as PI Insurance or Professional Liability Insurance, helps protect professionals and businesses against eligible claims arising from negligent advice, professional errors, omissions or failure to perform contracted professional services.

A client may claim that professional work caused financial loss, delay or another covered consequence. The policy may help with approved legal defence costs and eligible compensation, subject to its limits, deductible, retroactive date, reporting requirements and exclusions.

Who May Need Professional Indemnity Insurance?

Cover may be relevant for professionals such as:

1. Architects and Engineers: For eligible claims involving professional designs, specifications, calculations or project advice.
2. Accountants and Financial Consultants: For claims arising from eligible accounting, reporting, financial advice or consultancy services.
3. Legal Professionals: For eligible allegations involving professional legal services, subject to applicable regulatory and policy requirements.
4. Management and Business Consultants: For claims relating to professional recommendations, reports, strategies or project services.
5. Technology Professionals: Software developers, IT consultants and technology service providers may require suitable professional, cyber or combined coverage, depending on their activities.
6. Other Professional Service Providers: Surveyors, project managers, recruitment consultants, training providers and other specialists may also have professional exposures.

What May Professional Indemnity Insurance Cover?

Depending on the issued policy, coverage may include:

1. Professional Negligence: Eligible claims alleging that the insured failed to provide the expected professional standard of care.
2. Errors and Omissions: Covered mistakes, omissions or unintentional failures while providing declared professional services.
3. Legal Defence Costs: Approved legal expenses incurred in investigating and defending a covered claim.
4. Compensation and Settlements: Eligible damages, settlements or compensation payable to a claimant, up to the applicable policy limit.
5. Loss of Documents: Certain policies may cover specified costs arising from the accidental loss or damage of client documents when expressly included.
6. Additional Extensions: Defamation, intellectual-property infringement or other professional exposures may be considered only when specifically stated in the policy.

Is Professional Indemnity Insurance Mandatory?

Professional Indemnity Insurance is not universally mandatory for every UAE business or professional. However, it may be required for certain regulated professions and licensed activities.

It may also be required under a client contract, consultancy agreement, tender, free-zone condition or professional-body requirement. Applicants should confirm the limit, wording and territorial scope required by the relevant authority or contract.

Important Policy Conditions:

Review these details before selecting cover:

1. Declared Professional Services: Confirm that all advice, designs, consultancy and professional activities are accurately declared.
2. Limit of Indemnity: Check the maximum amount available for one claim and in total during the policy period.
3. Retroactive Date: Confirm the earliest date from which previous professional work may be considered, subject to the policy wording.
4. Claims Reporting: Many PI policies require claims and known circumstances to be reported during the policy period or an applicable reporting period.
5. Territory and Jurisdiction: Review where professional services may be performed and where eligible legal proceedings may be brought.
6. Deductible: Check the amount the insured must contribute towards each eligible claim.

What Is Commonly Not Covered?

Depending on the policy, exclusions may include:

1. Intentional, dishonest or fraudulent acts
2. Known claims or circumstances not disclosed before inception
3. Services performed outside the declared professional activities
4. Contractual liabilities exceeding normal legal liability
5. Fines, penalties and uninsurable sanctions
6. Cyber incidents unless expressly covered
7. Claims arising before the applicable retroactive date

What to Do After a Professional Claim:

The insured should:

1. Notify the Insurer: Report the claim, complaint or circumstance as soon as possible.
2. Preserve Documents: Keep contracts, proposals, reports, emails, designs, meeting records and other relevant evidence.
3. Avoid Admitting Liability: Do not accept responsibility or agree to compensation without the insurer’s approval.
4. Follow the Claims Process: Provide requested information and cooperate with appointed legal or claims representatives.

Documents Required:

The insurer may request:

1. Completed proposal or quotation form
2. Trade licence and company information
3. Description of professional services
4. Professional qualifications and experience details
5. Estimated annual professional fees or turnover
6. Details of major projects or contracts
7. Previous insurance-policy information
8. Claims history and known-circumstance declaration

Why Choose Al Buhaira Insurance?

Eligible professionals and businesses can access:

1. Professional Risk Assessment: The quotation can reflect the applicant’s services, qualifications, turnover, contracts and requested limits.
2. Cover for Different Professions: Enquiries can be considered for architects, engineers, accountants, consultants and other eligible professional service providers.
3. Liability Insurance Support: Professional Indemnity is available as part of Al Buhaira’s range of business liability products.
4. Online Quotation Request: Applicants can submit their contact details through the dedicated Professional Indemnity quotation-request page.

Frequently Asked Questions: