It is common knowledge that PI is an insurance cover which provides monetary protection or financial assistance in the event of legal action being taken against you if you have caused damage or loss through malpractice. In other words, PI insurance will cover you in the event you are sued by a person who claims they were injured as a result of your professional negligence.

In recent years, developers and main contractors take advantage of their strong negotiating position over generally smaller sub-contracting firms. This trend has influenced the indemnity and insurance requirements where developers seek to transfer responsibility for losses to tendering firms. Even though members can purchase project specific PI insurance when they have projects, some tenders require coverage beyond a specified run off period, and this may render the single project PI too expensive. What would be the solution?

In many tender documents the Client would request the engineer to indemnify and hold them harmless for a wide range of liabilities, such as “The Consultant shall indemnify the Principal from and against any and all actions, proceedings, liabilities, claims, demands, losses, damages, charges, cost and expenses of whatever nature the principal may directly sustain, incur or suffer by reason of, and arising out of or in connection with, the performance of this Agreement.”

Such a clause effectively passes all professional liabilities to the engineer. We would recommend that members carefully review the indemnity provision of all tender documents and seek our advice regarding the availability of insurance protection.

Buildings, depending on the dreams that form them, are often powerhouses of immense depth, emotion, and intense passion. And as that passion grows, it is only natural that the physical building too follows suit.

Being a non profit professional organization, we need support to make our vision for a new building materialize. Since 2007 friends have been generous in their contributions in enhancing this unique community. However, it remains vitally important to raise further funds. Looking ahead, we need to replenish our Building Fund.

We have arranged to ensure every PI policy purchased by members presents an opportunity to be involved in IEM’s professional life. The IEM earns a fee in this scheme, and this goes directly into our fund. Insuring with us would mean helping IEM to grow a family with a home of its own.

With a single, pooled limit of RM40 million in the aggregate shared by all participating members, this program provides enough protection to cover a very large loss while maintaining premiums at competitive levels. This affinity PI scheme only allows members to apply. We can then use bulk purchasing power to negotiate discounts from insurance companies or through intermediaries. Our preferential deals with the insurance company translate to higher “discounts” i.e. lower prices from the insurance company.

More importantly, our pool would translate into a sustainable insurance program for bad times, because there will be more to cushion against the claims made by certain members.

Finally as an organization IEM will have a new avenue to share risk management information.