Single Project Professional Indemnity (SPPI) Insurance

Protect Your Professional Services on Single Projects in Malaysia

Single Project Professional Indemnity (SPPI) insurance protects contractors, consultants, and engineers working on specific projects against claims of professional negligence, errors, or omissions.

At Foundation, we offer tailored SPPI coverage to safeguard your interests during the execution of construction, engineering, or specialized projects.

Why SPPI Insurance Matters in Malaysia

SPPI insurance covers risks related to errors, omissions, or negligence during a single project, such as:

• Professional Errors: Mistakes in design or execution
• Negligence: Failure to meet contractual obligations or industry standards
• Third-Party Claims: Financial or physical damage resulting from your professional services

What SPPI Insurance Covers

What SPPI Insurance Covers

• Professional Errors & Omissions: Coverage for design mistakes, miscalculations, or failure to meet specifications.
• Breach of Contract: Protection if you fail to fulfill the terms or timelines of your project contract.
• Negligence: Covers claims arising from failing to act with professional care and expertise.
• Third-Party Claims: Protection against lawsuits for third-party property damage or personal injury caused by your services.

Who Needs SPPI Insurance in Malaysia?

SPPI insurance is essential for:

• Contractors working on high-value or complex construction projects
• Design consultants such as architects, engineers, and surveyors
• Project managers responsible for managing the execution of projects
• Specialist subcontractors involved in critical / high-risk work
• Government contractors working on public infrastructure projects
• Consulting firms that provide project-specific advisory services

When Do You Need SPPI Insurance?

SPPI insurance is typically required when:

• Before project work begins, particularly in high-value construction projects.
• In tender agreements or client contracts to ensure liability protection.
• For projects involving third-party consultants, engineers, or other professional services.

Common SPPI Claim Scenarios

• Design Flaw Causes Delay: An architect’s miscalculation delays construction and increases costs.
• Breach of Contract: A contractor misses critical project deadlines, resulting in financial loss to the client.
• Negligence Leading to Loss: A subcontractor fails to meet safety standards, causing a major safety incident.

How Foundation Supports Your SPPI Programme

At Foundation, we specialize in structuring SPPI insurance for contractors, consultants, and project managers. Here’s how we help:

1. Risk Assessment: We evaluate your project’s risk profile to ensure appropriate coverage.
2. Market Placement: We work with insurers to secure the best terms for your project.
3. Documentation & Compliance: We ensure your SPPI insurance aligns with contract and regulatory requirements.
4. Claims Assistance: In the event of a claim, we help coordinate legal support and manage the claims process.

Frequently Asked Questions (FAQ)

What is SPPI insurance?

SPPI insurance, or Single Project Professional Indemnity insurance, provides coverage for contractors, engineers, and consultants working on a specific project. It protects against claims arising from professional errors, omissions, negligence, or breach of contract.

Why is SPPI insurance necessary for contractors?

SPPI insurance is crucial for contractors as it covers professional liabilities that could arise from project mistakes, delays, or errors. It ensures that you can continue your operations without incurring massive financial losses from third-party claims.

How does SPPI insurance work?

SPPI insurance works by providing coverage for legal defense costs, compensation for claims, and expenses related to project mistakes, delays, or damage caused during the course of a project. Coverage is project-specific, protecting you for the duration of that specific project.

Is SPPI insurance mandatory in Malaysia?

SPPI insurance is often required by clients, financiers, or government bodies, especially for large-scale, complex projects. It's usually mandated in tender agreements or contract clauses to ensure that both parties are protected against professional liability.