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Design engineers
Yes: if you design circuits, PCBs, embedded firmware or complete electronic products for clients, you need professional indemnity insurance. A design flaw, a missed requirement or a failed compliance test costs your client money in board respins, delayed launches and retesting, and those claims are about your professional judgement, not accidental damage. Product liability insurance is separate: it answers injury and property damage caused by a defective product, and usually sits with whoever places the product on the market.
Part of: Professional indemnity for IT professionals
In short
Hardware design consultants rarely sell the finished product, but their decisions determine whether it works, passes EMC and safety testing and can lawfully be sold. In Great Britain the manufacturer carries the conformity duties under the EMC, electrical equipment safety and radio equipment regulations, and under legislation in force since 1 October 2024 can continue to choose UKCA or CE marking. Consumer connectable products must also meet the PSTI security requirements in force since 29 April 2024. When a design fails those tests, the manufacturer’s claim comes to you. PI usually covers that claim; product liability and recall cover deal with injury, damage and withdrawal of products.
Last reviewed 5 October 2026 by the Apex professional indemnity team.
Design consultants rarely make or sell the finished product, but their decisions decide whether it works, passes its compliance tests and can be sold. When a schematic, PCB layout, component choice or firmware routine is wrong, the client pays for it in respins, retesting, missed launch dates, warranty returns and redesigns. Those are financial losses caused by professional judgement, which is what professional indemnity (PI) insurance is for.
The legal starting point is your contract. In a business-to-business design contract, the Supply of Goods and Services Act 1982 implies that you will carry out the service with reasonable care and skill. Many clients go further and write in a duty to meet a specification, a standard or a certification outcome, which can make you answerable for a result rather than for the care you took.
Product liability is a different risk. Under the Consumer Protection Act 1987, liability for damage caused by a defective product falls on the producer, anyone who puts their name or trade mark on the product as if they were the producer, and the importer. Product liability insurance answers that injury and property damage. If you only design, PI is usually your main policy; if you also supply, assemble or brand products, you need both. See PI vs product liability insurance.
The following scenarios are illustrative. They are not real claims, but they show how losses on hardware projects turn into allegations against the designer.
None of these involves accidental damage. Each says your design fell short of what a competent consultant would have produced, or of what the contract required.
Electronic products are judged against product safety regulations, harmonised standards and the client’s own specification. These are the reference points that most often decide a design dispute in Great Britain.
| Regulation or standard | What it says | Why it matters to your PI |
|---|---|---|
| Electromagnetic Compatibility Regulations 2016 (Great Britain) | Equipment must not generate electromagnetic disturbance above the level at which other equipment cannot operate as intended, and must have adequate immunity. The manufacturer carries out conformity assessment, prepares technical documentation and a declaration of conformity, and keeps them for 10 years. | An EMC failure is usually a design issue, and your design outputs form much of the technical documentation. |
| UKCA and CE marking | Under legislation in force since 1 October 2024, businesses can continue to use either UKCA or CE marking to place goods on the Great Britain market under the EMC, electrical equipment safety, radio equipment and RoHS regulations. Northern Ireland follows different processes for CE and UKNI marking. | Agree with the client which route and which market the design is aimed at before testing starts. |
| Product Security and Telecommunications Infrastructure (PSTI) regime | Since 29 April 2024, consumer connectable products must have unique or user-defined passwords, the manufacturer must say how to report security issues, and minimum security update periods must be published. The Office for Product Safety and Standards enforces it. | Firmware and connectivity design decisions now carry a legal compliance dimension for the client. |
| IEC 62368-1 | The international safety standard for audio/video, information and communication technology equipment and business machines with a rated voltage not exceeding 600V. The current edition was published in 2023. | Insulation, clearances and fire enclosure choices are tested against it. |
| Consumer Protection Act 1987, s.2, and Limitation Act 1980, s.11A | The producer, own-brander and importer are liable for damage caused by a defect in a product. Claims under the Act cannot be brought more than 10 years after the defendant supplied the product. | Product claims start with your client, who may then look to you under your contract. |
Under the EMC Regulations, a manufacturer is a person who manufactures apparatus, or has it designed or manufactured, and markets it under their own name or trade mark. In most consultancy work that is your client, not you. The legal duty to assess conformity, hold the technical file and sign the declaration of conformity sits with the brand owner.
That does not keep you out of the dispute. The technical file is built from your schematics, layouts, test plans and risk assessments, and the client’s contract with you decides who carries the cost when the product will not pass. The wording matters:
You become the manufacturer if you place products on the market under your own name, for example by selling modules or reference boards. At that point product liability, recall and compliance duties are yours, and PI alone is not enough.
| Usually covered by PI | Often excluded or limited | Needs a different policy |
|---|---|---|
| Errors in schematics, PCB layout, firmware and mechanical integration | Promises that a design will pass certification first time | Injury or damage caused by products you supply or brand (product liability) |
| Failure to meet the agreed specification | Fitness for purpose obligations beyond reasonable skill and care | Recalling products from the market (product recall insurance) |
| Negligent component selection, including obsolescence and temperature grades | Patent infringement claims | Damage to prototypes, test rigs and lab equipment (property or equipment cover) |
| Client claims for redesign, retest and delay costs caused by your negligence | Injury or property damage claims arising from a product you designed | Theft or encryption of your design files by attackers (cyber insurance) |
| Defence costs, including independent engineering experts | Aerospace, automotive, medical or US work not declared to the insurer | Injury to staff or visitors at your premises (employers’ and public liability) |
Cover depends on the wording and is subject to the policy terms. Tell your insurer which sectors your designs end up in; a policy written for consumer electronics may restrict work for safety-critical or North American markets.
Design consultancies hold their clients’ most sensitive assets: unreleased schematics, source code and production files. That makes the split between PI, often written for technology firms as technology errors and omissions (tech E&O) cover, and cyber insurance worth understanding before something goes wrong.
If attackers break into your systems and steal or encrypt client design files, cyber insurance pays your own costs: investigating the breach, restoring files, legal advice and lost working time. A client claim that you failed to keep its designs confidential is a liability claim, which may fall under PI or the liability section of your cyber policy, depending on the wordings.
A security flaw in the product itself is different. If firmware you wrote leaves a device open to attack, or falls short of the PSTI password rules, the client’s claim is about the quality of your design. That is a PI matter, not a cyber one, even though the subject is security. Our guide to cyber insurance explained covers what a cyber policy does for your own business.
Your limit is normally set by the client. Manufacturers and product companies write a PI requirement into design contracts, sometimes alongside a liability cap linked to the contract value. Think about what a failure would cost the client, not what the project fee was: a respin and relaunch can cost many times the design fee.
A complete proposal gets better terms than a bare one, and a broker can only present what you tell us. Have these ready:
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Apex Insurance Brokers is an independent insurance broker based in Bristol, established in 2009 and authorised and regulated by the Financial Conduct Authority. We are not tied to one insurer: we work with over 30 markets, including Lloyd’s syndicates through wholesale brokers, and every client has a named broker who handles the placement, mid-term changes, certificates for clients and the renewal.
Yes. A design error, missed specification or failed compliance test can cost your client respins, retesting, delays and lost sales, and those are financial losses public liability does not cover. PI pays defence costs and compensation when a client alleges your design work was negligent, subject to the policy terms.
No law requires electronics or hardware design consultants to hold PI. In practice manufacturers, product companies and design agencies write PI requirements into their contracts, often with a minimum limit, and clients in safety-critical sectors tend to ask for higher limits and evidence of cover before work starts.
PI usually covers financial loss caused by negligent design or advice, such as redesign and delay costs. Product liability covers injury and property damage caused by a defective product, and the Consumer Protection Act places that liability on producers, own-branders and importers. If you only design, PI is usually the main policy.
It may, if the failure resulted from negligence in your design and the client claims the respin, retest and delay costs from you, subject to the policy terms. It is less likely to respond where you promised a first-time pass, because guarantees and fitness for purpose obligations are often excluded.
Usually not directly. Under the EMC Regulations the manufacturer is the person who has apparatus designed or manufactured and markets it under their name, which is normally your client. Your contract can still make you responsible for delivering a design that meets the relevant requirements.
Often, yes. A vulnerability caused by negligent firmware design, or a failure to meet the PSTI password requirements you were asked to design for, is a claim about the quality of your work, which PI may cover subject to the wording. Cyber insurance usually covers attacks on your own systems.
Apex arranges professional indemnity insurance for electronics and hardware design consultants across the UK. Tell us about your work and we’ll find cover that fits. Or call 0117 325 0027.
Start your PI proposal Call 0117 325 0027Apex Insurance Brokers Limited is authorised and regulated by the Financial Conduct Authority. Registered in England and Wales, company number 07014570. This page is general information, not advice on your individual circumstances. Cover is always subject to the insurer’s acceptance and the policy terms, and this page does not guarantee that cover will be available or on what terms.
