RICS PII six-year run-off: what surveyors must carry after cessation

~4 min read

Reviewed by Matthew Bartlett, Director · Last reviewed 2026-07-06

When a RICS-regulated firm ceases to trade — whether by voluntary dissolution, retirement of principals, sale to a successor without succession, or any other cessation event — the RICS PII Requirements impose a six-year run-off obligation. The firm must maintain PII cover for at least six years from the date of cessation. That six-year floor matches the solicitors' MTC requirement under the SRA Indemnity Insurance Rules and is materially longer than the ICAEW's two-year floor for accountants. The rationale is exposure profile: surveying work generates claim notifications on a longer tail than typical accountancy work, and the six-year window aligns with the general limitation period under section 5 of the Limitation Act 1980 for contract claims. This entry sets out the placement mechanism, when extended run-off is prudent, and the interaction with the Building Safety Act 2022 for building surveyors.

The rule and its source

The six-year requirement sits in the RICS PII Requirements published alongside the Rules of Conduct for Firms. It applies to every RICS-registered firm regardless of size, discipline, or historical profile — a Red Book valuation practice, a dilapidations-focused building surveying firm, and a quantity surveying practice all face the same six-year floor. The clock starts on the RICS-notified cessation date, which for most firms is the date registration is surrendered rather than the date of the last billable engagement.

Why six years, not two

The rationale is claim tail. Surveying work, particularly building survey and valuation work, generates claim notifications years after the work is done. A homebuyer report identifying no defect where a serious defect existed may only surface when the defect manifests physically — sometimes three, four or five years after purchase. A commercial building survey commissioned before a lease acquisition may generate a claim when the tenant discovers the defect months or years into the term. A Red Book valuation used by a lender to size a facility may generate a claim only when the loan defaults and the collateral is reassessed. Six years captures the great majority of that notification tail; two years would not.

Placement mechanism

Run-off is placed in one of two ways. The preferred route is extended run-off with the incumbent insurer. The insurer already carries the firm's notification history, has priced the risk before, and understands the book. Continuity of insurer avoids arguments about where a claim should be notified if a matter surfaces during the run-off period but relates to work done in the last active year. Most Apex-arranged run-off placements start with a conversation with the incumbent well ahead of the intended cessation date.

The alternative is open-market placement. This happens where the incumbent has exited the surveyors PI market, priced the run-off punitively, or declined on claims grounds. The open market for run-off is smaller than the primary market and shrinks further where there is a live claim at cessation.

Pricing

Run-off in the surveyors' market is typically quoted as a single premium payable at inception, calculated as a factor of the last active-year premium and reflecting the size and profile of the firm. Multipliers vary — clean firms with straightforward work profiles can expect factors that produce a manageable single premium; firms with valuation-heavy back-books, live claims, or difficult BSA 2022 exposure can face factors that make the placement a material capital call. Firms planning cessation are strongly advised to engage a broker six to twelve months ahead of the intended cessation date so the run-off cost is known before the decision to cease is finalised.

When six years is not enough

Two scenarios in particular warrant serious consideration of extended run-off beyond the six-year minimum. The first is any building surveyor or party wall surveyor with material historical involvement in residential dwelling projects — section 135 of the Building Safety Act 2022 extended the limitation period under section 1 of the Defective Premises Act 1972 to 30 years retrospectively for defective residential dwellings completed before the Act commenced, and 15 years prospectively. Surveyors who signed off on structural inspections, party wall awards, or dilapidations reports on residential dwellings during the retrospective window may face notifications many years after cessation. Six years is the RICS floor; it is not the risk answer. Extended run-off to 10, 15 or 20 years is a serious conversation for firms with meaningful historical residential exposure.

The second is Red Book valuation work carried out for lenders. Lender-instructed valuation claims can crystallise years after the valuation, particularly when the borrower defaults and the security is reassessed. Firms winding down a lender-valuation book should consider extended run-off aligned with the average lifetime of the loans the valuations underpinned, which for commercial property often runs to 10 years or longer.

Worked example

Illustrative only. A three-partner chartered building surveying practice with a residential dilapidations back-book and material pre-2015 Red Book valuation work for high street lenders intends to cease on 31 March 2026. The senior partner is retiring; the two junior partners are moving to another firm and taking a limited client base with them but not the residential back-book. No successor practice will attach. The broker opens run-off conversations with the incumbent insurer in June 2025 — nine months ahead of cessation. Given the residential back-book exposure under BSA 2022, the firm elects to place a 15-year run-off rather than the six-year RICS minimum. Single premium payable at inception, priced as a multiple of the 2025-26 active premium factored for the 15-year period. Cover maintained on the same aggregation and each-and-every basis as the active policy.