Yes. The NSW Government’s Insurance cover for building work page, updated 6 July 2026, says registered design practitioners and professional engineers must have professional indemnity (PI) insurance under an individual, partnership or corporate policy. It does not state a mandatory PI cover amount and says practitioners must assess adequacy against their own circumstances. Figures checked 1 October 2026.
Which PI policy structures are available?
The NSW Government identifies these options:
- Individual policy
- Partnership policy
- Corporate policy
A partnership or company structure therefore does not rule out PI insurance. However, the cited material does not provide detailed scope rules for each structure or state a required cover amount. Do not treat the structure name as a substitute for checking that the policy provides adequate cover for the work being undertaken.
Read the policy’s Product Disclosure Statement (PDS) and confirm that it indemnifies the relevant practitioner and work. The NSW guidance also warns that different practitioners have different business risks, so one policy structure or cover level will not necessarily suit every practice.
How should I choose the amount and type of cover?
The NSW Government says practitioners must assess whether their PI cover is adequate for their circumstances. Its listed considerations include:
- their financial resources;
- risks associated with their work;
- the policy limits; and
- other factors outlined in the Design and Building Practitioners Regulation 2021.
The cited material does not provide a mandatory PI sum. A practitioner may also need to show that they have assessed the adequacy of their cover and should seek independent advice about the amount and type needed.
Is PI insurance the same as Home Building Compensation cover?
No. The NSW Government lists PI insurance and Home Building Compensation (HBC) cover as separate requirements.
| Insurance | Who the requirement applies to | NSW requirement |
|---|---|---|
| Professional indemnity insurance | Registered design practitioners and professional engineers | PI insurance must be in place and may use an individual, partnership or corporate policy. |
| Home Building Compensation cover | Licensed builders and tradespeople in NSW | HBC cover is required for each home building project over $20,000 including GST. |
HBC cover, formerly called home warranty insurance, protects homeowners as a last resort if building work cannot be completed or defects cannot be fixed.
A separate check applies when contracting an individual or business for more than $20,000 of home building work. Before paying any money, including a deposit, and before the work starts, the NSW Government says to check that the business has valid insurance using the HBC Check online tool.
That home building insurance check should not be treated as evidence that a separate PI requirement has been satisfied.
What changes on 1 July 2027?
From 1 July 2027, a registered building practitioner must be indemnified under an insurance policy for work carried out in that capacity, in addition to taking out HBC cover.
This dated requirement applies to a registered building practitioner. The cited wording does not state that every professional engineer automatically falls within that description, so practitioners should check the current regulator guidance for their registration and work.
What should I confirm before relying on a policy?
Check both the current regulator page and the policy’s PDS. Confirm that:
- the policy is relevant to your registration and work;
- the cover is adequate for your circumstances;
- the financial resources, work risks and policy limits have been considered; and
- any requirement to demonstrate a cover assessment can be met.
This is general information, not financial or legal advice. The policy PDS and current regulator requirements should guide the final decision.
Sources
FAQ
Can my company hold a PI policy for design work?
Yes. A corporate policy is one of the policy structures identified by the NSW Government. The cited material does not provide a mandatory amount or detailed scope, so check the PDS and assess whether the policy adequately indemnifies the relevant work.
Can a partnership use one PI policy?
A partnership policy is also an available structure under the NSW guidance. Whether it provides adequate cover for a particular practitioner and their work must be confirmed from the policy wording and assessed against that practitioner’s circumstances.
What amount of PI cover should I choose?
The cited NSW Government material does not state a mandatory PI cover amount. Consider your financial resources, the risks associated with your work, the policy limits and the other relevant regulatory factors. Independent advice on the appropriate amount and type of cover may be needed.
Does HBC cover satisfy the PI requirement?
No. HBC cover and PI insurance are listed as separate requirements. HBC protects homeowners in specified circumstances, while registered design practitioners and professional engineers must have PI insurance for their work.
When does the additional registered building practitioner requirement apply?
From 1 July 2027, a registered building practitioner must be indemnified under an insurance policy for work carried out in that capacity, in addition to taking out HBC cover.