Professional indemnity insurance -- the term used interchangeably with professional liability or E&O in many markets -- has become a compliance requirement that GCs can no longer treat as secondary to CGL verification.

Three trends in 2026 are forcing the issue. Design-build delivery has become the dominant project delivery method in commercial construction, expanding the number of subs performing professional services. Construction litigation increasingly targets design errors as a root cause rather than workmanship defects. And project owners are flowing down professional liability requirements to GCs, who must flow them down to subs.

This checklist gives GCs a structured framework for verifying professional indemnity coverage from every subcontractor and consultant performing professional services.

The Professional Indemnity Verification Checklist

Use this checklist for every subcontractor whose scope includes design, engineering, consulting, testing, inspection, or commissioning services.

Section 1: Policy Existence and Basic Terms

Professional indemnity/professional liability certificate or evidence of coverage received (separate from ACORD 25)
Named insured matches the contracting entity exactly
Policy is currently active (effective date is past, expiration date is future)
Policy form confirmed as claims-made (most professional liability policies)
Carrier identified and documented

Section 2: Claims-Made Trigger Verification

Claims-made policies present unique compliance risks that occurrence-based policies do not. This section addresses those risks specifically.

Retroactive date identified on the certificate or declarations page
Retroactive date precedes the earliest date of professional services for this project
If retroactive date does not precede project services, prior acts coverage has been confirmed
Policy has been continuously renewed without gaps since the retroactive date
No evidence of carrier changes that may have reset the retroactive date

The retroactive date is the single most important verification point on a claims-made professional indemnity policy. A policy with a $5M limit and a retroactive date that postdates the sub's design work on your project provides zero coverage for that design work.

Section 3: Limit Adequacy

Per-claim limit meets or exceeds the subcontract requirement
Aggregate limit meets or exceeds the subcontract requirement
Limits are appropriate for the design discipline and project value
If aggregate limit equals per-claim limit, the risk of single-claim exhaustion has been acknowledged

Project Value	Minimum Per-Claim Limit	Minimum Aggregate
Under $5M	$1M	$1M
$5M-$15M	$1M	$2M
$15M-$25M	$2M	$2M
$25M-$50M	$2M	$4M
$50M-$100M	$5M	$5M
Over $100M	$5M+	$10M+

Section 4: Defense Cost Treatment

This is a detail that changes the effective available coverage by hundreds of thousands of dollars.

Defense cost treatment confirmed: inside limits or outside limits
If defense costs are inside limits, the effective coverage reduction has been evaluated
If the subcontract requires defense costs outside limits, the policy has been confirmed to comply

Defense costs inside limits means every dollar spent on attorneys, expert witnesses, and litigation support reduces the amount available for a settlement or judgment. On a $1M per-claim policy with defense costs inside limits, a contested claim can consume $300,000-$500,000 in defense costs before any settlement discussion begins.

For design scopes with high severity potential (structural, geotechnical, building envelope), GCs should consider requiring defense costs outside limits or requiring higher per-claim limits to account for the erosion.

Section 5: Contractual Liability Coverage

Policy does not exclude contractual liability for professional services
Indemnification obligations in the subcontract are insurable under the professional indemnity policy
Hold harmless provisions have been reviewed against the policy's contractual liability coverage

Many professional indemnity policies exclude or limit coverage for contractual liability -- obligations assumed under contract beyond what the law would otherwise impose. If the subcontract contains a broad indemnification clause for professional services, but the professional indemnity policy excludes contractual liability, the sub has agreed to indemnify the GC without insurance backing.

Section 6: Pollution Professional Liability

Environmental claims arising from professional services are a growing exposure in construction. A geotechnical engineer who fails to identify contaminated soil. An environmental consultant who mischaracterizes remediation requirements. A mechanical engineer whose HVAC design causes indoor air quality failures.

Pollution liability coverage confirmed under the professional indemnity policy (or separate pollution professional liability policy)
If pollution is excluded from the professional indemnity policy, a separate Contractor's Pollution Liability (CPL) or Pollution Professional Liability policy has been verified
If the project involves brownfield development, environmental remediation, or sensitive occupancies (healthcare, education), enhanced pollution coverage has been confirmed

Standard professional indemnity policies handle pollution in three ways:

Full pollution exclusion (most restrictive)
Pollution coverage for professional services claims only (moderate)
Integrated pollution professional liability (broadest)

GCs on projects with environmental sensitivity should require option 2 or 3.

Section 7: Exclusion Review

Professional indemnity policies contain exclusions that can silently eliminate coverage for project-relevant risks.

Policy exclusions reviewed for project-specific applicability
No exclusion for the specific type of professional services being performed
No geographic exclusion preventing coverage in the project location
No prior knowledge exclusion that could apply to known project conditions
No specific project exclusion (some carriers exclude individual high-risk projects)

Common exclusions to flag:

Asbestos or lead paint: Relevant for renovation projects
Nuclear: Rarely relevant but present in many forms
EIFS/synthetic stucco: Some carriers exclude claims related to exterior insulation and finish systems
Mold/fungus: Some policies limit or exclude mold-related claims
Cyber/technology: Some policies exclude claims arising from BIM, digital twin, or technology platform errors

Section 8: Tail Coverage and Post-Completion Obligations

Subcontract includes a tail coverage obligation (minimum duration specified)
Tail coverage duration matches or exceeds the applicable statute of repose
Mechanism for enforcing tail coverage is documented (retention withholding, bond, etc.)
If the sub has changed carriers during the project, tail coverage from the prior carrier has been confirmed or the new carrier's retroactive date has been verified

The tail coverage obligation is only as enforceable as the mechanism behind it. A contractual obligation without financial leverage (retainage, bond, or escrow) gives the GC a breach of contract claim but no insurance.

Section 9: Additional Compliance Provisions

Sub has agreed to provide 30 days advance notice of cancellation, non-renewal, or material change
Sub has agreed to provide updated certificates upon renewal
GC's right to request certificates at any time is documented in the subcontract
If additional insured status is available on the professional indemnity policy, it has been requested and confirmed
If waiver of subrogation is available, it has been requested and confirmed

Note: Additional insured status and waiver of subrogation are less commonly available on professional indemnity policies than on CGL policies. Do not assume these provisions exist. Verify with the carrier.

Implementing This Checklist in Practice

A printed checklist sitting in a filing cabinet does not reduce risk. Implementation requires:

Assignment. Designate who is responsible for completing the checklist for each subcontractor. This is typically the project-level compliance coordinator or the corporate risk management team.

Timing. Complete the checklist before the subcontract is executed. Professional indemnity verification should be a prerequisite for subcontract execution, not a post-award task.

Documentation. Store completed checklists with the subcontractor compliance file, not in personal email folders. The checklist should be retrievable by anyone managing the project.

Monitoring. The checklist is a point-in-time verification. Professional indemnity policies renew annually. Set monitoring for renewal dates, retroactive date changes, and carrier changes throughout the project duration.

Escalation. Define what happens when a checklist item fails. If a sub's retroactive date is insufficient, who makes the call to proceed, hold, or require corrective action?

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Frequently Asked Questions

Is professional indemnity insurance the same as professional liability insurance? Yes. Professional indemnity is the term commonly used in international markets (UK, Australia, Canada) for what the U.S. market calls professional liability or errors and omissions (E&O) insurance. The coverage is functionally identical.

Why does the claims-made trigger create more compliance risk than occurrence-based policies? Claims-made policies only respond if the claim is reported during the active policy period and the wrongful act occurred after the retroactive date. This creates gaps when policies are canceled, non-renewed, or when subs switch carriers. Occurrence policies cover events that happen during the policy period regardless of when the claim is reported.

What is the difference between defense costs "inside limits" and "outside limits"? Defense costs inside limits means attorney fees and litigation expenses reduce the available policy limits. On a $1M policy with $400K in defense costs, only $600K remains for a settlement. Defense costs outside limits means litigation expenses do not reduce the policy limits -- the full $1M remains available for a settlement.

Should GCs verify professional indemnity from testing and inspection firms? Yes. Testing and inspection firms perform professional services (interpreting test results, certifying compliance, recommending acceptance or rejection). Errors in these professional judgments can lead to claims that CGL policies will not cover.

How often should professional indemnity compliance be re-verified? At a minimum, upon each policy renewal (annually for most policies). GCs should also re-verify after receiving notice of any carrier change, coverage modification, or claim that may affect available limits.

What is pollution professional liability and when should GCs require it? Pollution professional liability covers claims arising from pollution conditions caused by or related to professional services. GCs should require it from environmental consultants, geotechnical engineers on brownfield sites, and any design professional working on projects involving environmental remediation or sensitive occupancies.