Fire safety and cladding exclusions in PI insurance

Why these exclusions exist

The exclusions are a market response to a liability that turned out to be much larger and much longer than the premiums collected against it. The Building Safety Act 2022 extended limitation for Defective Premises Act claims — 15 years for claims accruing on or after 28 June 2022 and 30 years where the right of action accrued before that date — and the courts have since confirmed that this reach extends to negligence and contribution claims that depend on those time limits.

Insurers writing annual, claims-made policies cannot price a liability tail of that length with any confidence. Restricting the class of loss is how they have responded. It is not aimed at your practice specifically, and pushing back on the principle rarely gets anywhere. Working on the scope of the wording, and on the accuracy of what you are declared to do, sometimes does.

How the wordings differ

There is no standard exclusion, which is the first thing worth knowing. Broadly, the restrictions you will encounter fall into a few families.

External wall system or cladding exclusions. These target claims arising from the design, specification, installation or inspection of external wall systems, cladding, rainscreen, insulation, render or curtain walling. Some are limited by building type or height; some are not.

Fire safety exclusions. Broader in reach, these can pick up any claim arising from fire safety or fire performance of a building, including fire-stopping, compartmentation, means of escape and fire strategy. A practice that has never touched cladding can still be caught by one of these.

Height or building-type conditions. Rather than excluding a class of work, some policies carve out buildings above a stated height, or residential buildings of a stated description, sometimes aligned to the higher-risk building thresholds.

Sub-limits and separate excesses. Instead of a flat exclusion, cover may be present but capped well below the main limit, or subject to a much larger excess, or written on an aggregate basis where the rest of the policy is each and every claim.

The differences between these are not academic. Two firms with apparently similar cover and similar premiums can be in completely different positions when a claim arrives, and the only way to know which you are is to read the actual endorsement rather than the summary.

What a "no cladding involvement" declaration actually means

Many insurers offer better terms where a firm confirms it has had no involvement with external wall systems or cladding, either at all or within a stated period. That confirmation is not a formality. It is a statement made to induce the insurer to write the risk, and if it turns out to be wrong the consequences can reach beyond the individual claim to the policy as a whole.

So it needs to be true, and it needs to be true across the whole practice and the whole relevant history — including work done by people who have since left, projects where the practice had a small role, specifications that adopted a system chosen by someone else, and inspection or monitoring roles where the practice did not design anything but did sign things off.

The honest position is often more nuanced than yes or no. A practice may have had no design involvement but some monitoring involvement; or involvement only on low-rise buildings; or involvement limited to a period that ended years ago. Say so, precisely. A qualified but accurate declaration is worth far more than a clean one that does not survive scrutiny. This is a matter of fair presentation of the risk, and getting it wrong is the one mistake that can leave a firm effectively uninsured.

What a firm can actually do to present better

Start with the facts about your own history. Establish, with evidence rather than memory, what proportion of your past work was residential, what building heights were involved, and where the practice sat in the chain — lead designer, sub-consultant, inspector, certifier. Practices are very often carrying an assumed exposure that the record does not support.

Then look at the boundaries of your service. Where the practice deliberately excludes certain elements from its scope, that should be visible in the appointment documents, not just understood between the parties. Where specialist design is contractor-designed or performance-specified, the documentation should show it.

Then look at process. Underwriters respond to evidence of design review, of formal sign-off gates, of competence assessment for dutyholder roles, and of document retention that will still exist in fifteen years. On the higher-risk building side, the gateway regime generates exactly this kind of record, which is one of the few underwriting silver linings in it.

Finally, be realistic about timing. Renewal presentations put together in the last fortnight are the ones that get generic terms. A construction PI renewal is worth starting months out.

What Apex offers, and what we do not promise

We do not promise to remove fire safety or cladding exclusions. In the current market that is not a promise anyone can honestly make, and a broker who makes it is telling you what you want to hear.

What we do is build an accurate, evidenced presentation of your risk and take it to markets that understand construction professionals rather than treating them as a generic professional risk. That means the difference between a broad fire safety exclusion and a narrow external wall system one; between cover excluded and cover sub-limited; between terms priced for the work you actually do and terms priced for the worst case an underwriter can imagine. Those differences are where the value is.

Frequently asked questions

Do all PI policies now exclude cladding?

Not all, but restrictions of some kind are common across the construction professional indemnity market and have been for several years. The important question is not whether a restriction exists but how widely it is drawn — whether it targets external wall systems specifically, or fire safety generally, and whether it is limited by building type or height.

Can a broker get a fire safety exclusion removed?

Realistically, no — and you should be wary of anyone who says otherwise. What can change is the scope of the wording, whether cover is excluded outright or sub-limited, and the price, and all three respond to how accurately and completely your risk is presented to the right markets.

What happens if I declare no cladding involvement and it turns out I had some?

It is potentially serious. A declaration of that kind is made to induce the insurer to write the risk, and an inaccurate one raises questions of fair presentation that can affect the policy beyond the individual claim. Check the position across the whole practice and the whole relevant history before signing, and qualify the answer where the truth is nuanced.

Does the exclusion apply to work I did before the exclusion was added?

Generally yes, because professional indemnity is claims-made. The policy that responds is the one in force when the claim is made, so its exclusions are applied to the claim regardless of when the underlying work was carried out. This is the central mismatch between claims-made cover and the long liability tail created by the Building Safety Act.

This page is insurance information for UK businesses, not legal or regulatory advice. It describes how the Building Safety Act landscape is affecting professional indemnity cover and what underwriters are asking; it does not tell you how to comply with the legislation. For advice on your duties under the Act, take specialist legal advice. Position stated as at August 2026.

Apex Insurance Brokers Limited is authorised and regulated by the Financial Conduct Authority (FRN 724952). This page is general information, not advice on a specific policy.