Professional Indemnity (PI) Insurance for Consulting Engineers in Kenya

In Kenya’s fast-growing infrastructure and construction sectors, Consulting Engineers play a vital role. Their expertise in design, analysis, and project supervision forms the backbone of national development. However, with this responsibility comes significant professional risk — errors or omissions can lead to costly lawsuits and reputational damage.

That’s where Professional Indemnity (PI) Insurance steps in — a specialized protection plan designed to safeguard professionals such as engineers, architects, and quantity surveyors from financial and legal exposure.

This article breaks down what PI insurance is, why it’s essential for engineers in Kenya, how Step by Step Insurance supports professionals with tailored solutions, and how to choose the right cover.

I. Understanding Professional Indemnity (PI) Insurance

What Is PI Insurance?

Professional Indemnity (PI) insurance protects professionals against legal claims arising from negligence, mistakes, or omissions in the services they provide.

While it’s available to all professionals (lawyers, doctors, accountants, etc.), a specialized PI cover for Consulting Engineers caters to the unique technical risks involved in engineering work — including design flaws, specification errors, and miscalculations.

A. The Standard of Professional Care

Engineering is a regulated profession requiring specialized training, licensing, and a high degree of skill. Because of this, engineers are held to a high standard of care.

If a professional fails to meet this standard — even unintentionally — they can be held liable for resulting losses. PI insurance protects against such liabilities.

B. Core Indemnification for Engineers

The policy provides coverage for:

• Negligence, errors, or omissions in professional services.
• Claims made against the engineer, their partners, or employees.
• Acts performed under supervision during the insured period.

Common covered scenarios include:

• Design or calculation errors.
• Oversights in project specifications.
• Failure to meet contractual standards.

II. The Financial Importance of PI Insurance in Kenya

Kenya’s business environment is increasingly litigious — clients are more aware of their legal rights, and court awards for professional negligence are rising.

Without PI insurance, a single lawsuit could bankrupt a small or medium-sized engineering firm.

A. Financial Protection and Asset Security

PI insurance protects professionals from devastating financial losses. It covers:

• Client Compensation: Damages awarded to a claimant (up to the policy’s limit).
• Legal Defense Costs: Includes court fees, lawyer charges, and expert witness expenses — even if the claim is unfounded.

This ensures that one mistake doesn’t destroy years of hard work.

B. Enhancing Credibility and Business Growth

Beyond protection, PI insurance offers strategic business advantages:

• Peace of Mind – Enables professionals to work confidently, knowing they’re covered.
• Brand Credibility – Boosts client and investor trust.
• Tender Eligibility – Many contractors and government tenders require proof of PI insurance before awarding projects.

Related Resources
Step-by-Step Guide to Buying Professional Indemnity Insurance in Kenya
PI Insurance Requirements for Tenders and Licensing in Kenya (2025 Update)
From Liability to Leverage: How PI Insurance Boosts Business Growth in Kenya

III. Policy Details and Coverage Structure

A. Key Extensions and Add-ons

Type of Claim / Risk	Coverage Detail	Extension Provision
Loss of Documents	Covers reconstruction if documents are lost or damaged.	Often free (up to 10% of policy limit) or at an extra premium.
Defamation (Libel & Slander)	Covers claims for reputational harm.	Free or at an extra premium.
Employee Dishonesty	Covers liability due to dishonest acts by staff.	Available as an extension.
Partner Liability	Covers claims related to incoming/outgoing partners.	Available as an extension.
Other Risks	Breach of confidentiality, omissions, disciplinary hearing costs.	Core or extended coverage.

B. Policy Exclusions

PI insurance does not cover every risk. Exclusions typically include:

Exclusion Category	Detail
Prior Acts	Claims arising before policy start date.
Criminal Acts	Illegal activities or fraud.
Substance Impairment	Acts committed under the influence.
Scope Limitation	Acts outside professional duties.
Insolvency	Bankruptcy or business failure.
Internal Claims	Claims by employees or partners.
Employee Injury	Work-related bodily injury.
Force Majeure	Terrorism or political unrest.

C. Application Requirements

To apply for a PI policy, professionals must provide:

• A completed and signed proposal form.
• Practicing license(s) or certificate(s).
• PIN and ID copies (for individuals).
• Company incorporation certificate and CVs of partners (for firms).

Risk Assessment Factors Include:

• Qualifications and experience of partners.
• Number of qualified employees.
• Annual turnover or fees.
• Claims history and retroactive cover.
• Desired indemnity limits and extensions.

D. Premium Structure and Deductibles

Premiums are annual and depend on the level of liability and type of engineering work. Most policies include a deductible (excess) — the amount the insured must pay per claim, typically 5%–25%.

IV. Step by Step Insurance: Partnering with the Best for Your Protection

At Step by Step Insurance, we believe that your expertise deserves equally expert protection. That’s why we’ve built strong partnerships with Kenya’s top insurance providers, ensuring that every client — from individual consulting engineers to large firms — receives the best coverage, value, and support.

With Step by Step Insurance, you’re not just buying a policy — you’re gaining a long-term protection partner that helps your business stay resilient, credible, and ready to take on bigger opportunities.