Zurich Global Corporate UK has announced that it is launching a new Owners' Protective Professional Indemnity product.
Owners’ Protective Professional Indemnity (OPPI) provides professional indemnity cover which is aimed at construction project owners who require additional cover on top of their contracted design team’s annual practice policy. The insurance cover is activated when the design team’s practice policy limits are exhausted and if there’s no underlying insurance. The OPPI policy then acts as if there would have been underlying insurance.
The insurer has surveyed all the major London brokers, who have supported the introduction of the product, following continued and growing demand for the product in the US market; and the absence of the product in the UK.
The OPPI policy indemnifies the project owner for losses arising out of the design professional’s negligence in performing professional services on an owner’s project.
According to the company, this insurance cover increases financial security for the project owner and financiers, reduces adversarial relations with design professionals, and provides noticeable premium cost savings compared to traditional project specific professional liability insurance.
Zurich will focus on most project types, typically commercial buildings, schools, roads and municipal structures. Policy periods can run for as long as 10 years in total, which allows a significant period for completion of the construction period and an extended reporting period.
Nils Sorenson, product manager of construction at Zurich Global Corporate UK, said: Overall, feedback from brokers and our own market research revealed a gap in terms of project insurance.
Many UK carriers have largely withdrawn from project specific professional liability insurance due to the long-term commitment and the large claims generated in the past, which means existing products are considered to be either cost prohibitive or offering too limited in terms of liability coverage. As a result, brokers have told us that many of their clients often take this risk of costly claims on themselves.