Journal of Engineering, Project, and Production Management, 2023, 13(1), 37-48
Utility of Professional Indemnity Insurance in the Building Sector
1Senior lecturer, Department of
Construction Economics and Management, Copperbelt University, P.O. Box
21692, Kitwe, Zambia. E-mail: chipozya@yahoo.co.uk (corresponding
author).
2Quantity Surveyor, Stefunutti Stocks Zambia Limited, P.O.
Box 32054, Lusaka, Zambia. E-mail: paulsonhagonka@gmail.com
3Associate Professor, Department of Construction Economics
and Management, Copperbelt University, P.O. Box 21692, Kitwe Zambia;
Research Associate, Quantity Surveying and Construction Management,
Faculty of Natural and Agricultural Sciences, University of the Free
Sate, Bloemfontein 9300, South Africa. E-mail: muleyaf@yahoo.co.uk
Project Management
Received June 16, 2022; revised July 15, 2022; October 7, 2022; accepted October 7, 2022
Available online November 21, 2022
Abstract: Projects in the construction industry are becoming more complex and riskier resulting in claims against consultants. It is unclear how consultants in the construction industry are using the professional indemnity (PI) insurance as a protection mechanism in the Zambian building sector. Expert sampling was used to select the sample sizes for the participants, one from each firm of interest. A self-administered questionnaire survey on insurance companies and consultant quantity surveyors was used to collect data. The study recorded response rates of 71% from general insurance companies and 48% response rate from quantity surveyors. Descriptive statistical analysis was used to analyse the data due to non-randomisation of the sample. Additionally, content analysis was used for open-ended questions. The findings show that the PI cover is relatively easy to acquire; however, there is a gap in knowledge on which risks are covered by the current PI policy among insurance firms and consultant quantity surveyors in the Zambian construction industry. PI in the Zambian construction industry is a general insurance cover which does not specify the risks covered resulting in low uptake of the PI cover. In most cases, professional indemnity insurance is not enforced even when there is a default case because it is not mandatory. The study therefore recommended that improvements must be made to the current general professional indemnity cover to make it mandatory and specific to the individual consultants so that specific profession risks are covered.
Keywords: Professional indemnity insurance (PII), consultants, building projects, Zambia.
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Citation: Tembo, C. K., Hangoka, P., and Muleya, F. (2023). Utility of Professional Indemnity Insurance in the Building Sector. Journal of Engineering, Project, and Production Management, 13(1), 37-48.
DOI:
10.32738/JEPPM-2023-0005
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