Insurance

Why must I hold insurance? 

 

FPAS requires accredited individuals to be appropriately covered by insurance for the fire protection services they undertake. 

 

Public and product liability and professional indemnity insurances protect both practitioners and their assets against claims in response to injury / property damage or against the professional services they provide. 

 

Insurance is a requirement of the NSW Government, which seeks to have accredited individuals provide a duty of care to their clients without risking significant financial hardship. 

 

 

What insurance must I hold as an accredited individual? 

 

FPAS requires an accredited individual (or the company they work for) to have the following minimum insurance cover: 

  • public and product liability:  $10 million; and

  • professional indemnity for any one claim of: 

    • $2 million inclusive of defence costs; or

    • $1 million exclusive of defence costs. 

 

Public and products liability and Professional indemnity insurance Must: 

  • include in the list of business activities, all work activities relevant to the accreditation class and category held; and

  • be in the name of the accredited individual or the company name only and not be a joint policy with any other party; and

  • cover all past work of an accredited individual whilst accredited with Fire Protection Association Australia (FPA Australia) up to a maximum of 10 years. 

 

 

What is public and product liability insurance? 

 

Liability insurance covers third parties against injury and/or property damage as a result of your occupation. 

 

Liability insurance includes the legal costs of investigating and defending you or your business against any claims made. 

 

All accredited practitioners are required to have a minimum of $10 million coverage throughout their period of accreditation. 

 

 

What is professional indemnity insurance? 

Professional indemnity insurance covers negligence arising from professional advice or services provided to clients. 

 

As with public and product liability insurance, this coverage relates to claims made against the business by third parties. 

 

All accredited practitioners must hold professional indemnity insurance to cover them for any one claim for a minimum of $2 million per claim, including defence costs, or $1 million without defence costs. 

 

 

How does professional indemnity insurance work? 

PI is on a claims made basis insurance, which means you must have a current insurance policy in place in order to make a claim. 

 

Under law, a third party can make a claim against a practitioner at any time - there is no time limit. 

 

However, the scheme requires you to be covered for up to 10 years of accreditation

 

This means that, even if you haven't been working for a company since 2014, a claim can still be made against you until 2024 for work you carried out with them. 

 

That said, FPAS will only focus on work carried out within the 10 year window commencing from the moment of accreditation, not work that occurred before that. 

 

 

Why do I need both public and product liability AND professional indemnity insurance?   

These insurances cover different things, so both insurances are essential. 

 

A public liability claim, for example, may cover you if someone tripped over your equipment, while professional indemnity would come into play if a system you designed, installed, or assessed ended up failing. 

 

Practitioners need to be covered for both scenarios for their own sakes, and for third parties. 

 

Your insurance company can provide you with further guidance on both forms of insurance. 

 

 

What must an accredited individual provide to FPA Australia? 

Accredited individuals must provide a certificate of currency from their insurer as proof of their insurance cover for both public and product and professional indemnity insurance. 

 

This certificate should be on the insurance company's letterhead and should include: 

  • insurance company name;

  • confirmation that the insurance is public liability or professional indemnity insurance;

  • confirmation that the insurance covers civil liability for accredited competent fire safety practitioners;

  • the policy number;

  • the name of the insured;

  • the professions that the policy covers;

  • the words"Fire Systems Design"or"Fire Safety Assessment";

  • the start and end dates for the policy;

  • the retroactive date - the date from which the insurance applies;

  • limits of indemnity:

    • for public and product liability:  minimum $10 million; and

    • for professional indemnity:  minimum of $2 million (inclusive of defence costs) or $1 million (exclusive of defence costs) for any one claim; and

  • the Aggregate Limit of each policy. 

 

 

Can I have a gap in my insurance?  

In short:  no. 

 

The NSW Government requires all accredited individuals to maintain their insurance for the entire time they are accredited. 

 

This includes their period of accreditation up to and including the previous 10 years. 

 

A lapse in insurance will result in the cancellation of your accreditation. 

 

 

So I can't take a break? 

Sure you can, if you apply to suspend your accreditation. 

 

Say you want to take a six month tour of Europe, and so won't be doing fire safety assessments in the mountains of Bulgaria. 

 

You can simply apply to FPA Australia to suspend your accreditation for that period and are not required to maintain insurance at that time. 

 

However, this does not mean that people cannot make a claim against you while you're hiking the trails, so it may be wise to continue your insurance regardless of any time off, especially Professional Indemnity. 

 

 

What happens if a former company winds up or becomes insolvent?   

Any work you perform as an employee for a company will be covered by that company's PI insurance, so long as it has a current policy in place. 

 

This applies even if you no longer work with them. 

 

Generally, if a company winds up and ceases to pay its insurance, you are expected to take out insurance to cover the shortfall. 

 

 

Do I need runoff insurance? 

 

There is no requirement under FPAS for practitioners to have runoff insurance. 

 

However, FPA Australia recommends that individuals obtain runoff insurance for at least seven (7) years after they cease working as a competent fire safety practitioner, so as to indemnify their other work activities.