The reason for this is Professional Indemnity Insurers are reluctant to provide policy coverage to clients not receiving a fee for a professional service, as their exposure cannot be clearly defined.
Most of the clients we see affected by this issue are those that offer construction, manufacturing or supply services, where they do not involve a professional service to begin with or alternatively they subcontract these services to other professionals.
The result of this issue is that affected clients can be put in the situation where any subsequent action resulting in Personal Injury, Property Damage or a financial loss may not fall within the scope of their existing policy coverage.
Clients may believe that their Public and Products liability will cover a claim, but on closer inspection many policies will have specific exclusions in place for Personal Injury or Property Damage as a result of professional services.
HOW QUANTA CAN HELP
Quanta can arrange for extended cover on the clients existing liability policy to include Personal Injury or Property Damage as a result of professional services, we can also include Errors & Omissions coverage or Professional Indemnity within the same policy to provide coverage for financial loss.
In the changing legal environment; clients need to be aware of this exposure and seek appropriate coverage to "mind the gap".