PI Scheme Update 2023-24 Ireland

example of how insurers can get themselves into trouble, with resultant difficulties for many of their insureds. At the same time, there were many other ingredients in the mix. Allied to the difficulties being experienced in the insurance market was a perceived deterioration in the risk profile of the construction professions, with: Firms being required to do ‘more for less’ under increasingly onerous contracts; An uncertain and potentially more onerous legislative landscape in the form of extended liability periods and the potential for the introduction of a ‘strict’ liability regime under the Building Safety Act; Demands for ever increasing levels of PI insurance; A trend towards higher value claims; and Increased exposure arising from the failure of other parties and the application of the joint and several liability principle. These factors, together with the very significant risks associated with fire safety, left construction professionals particularly exposed, with many struggling to access appropriate and affordable insurance protection. Where are we now? Today, fewer firms are going to face that existential threat of not being able source any PI insurance cover. The level of underwriting scrutiny and the actions imposed by insurers in recent years have given them a degree of comfort around the risks they hold and there is some evidence of an increase in market capacity overall. In that sense, it could be said that the market has ‘settled down’ but at a level that many will see as painful in terms of premium and coverage. We shouldn’t forget that many insurers have introduced wide-ranging restrictions that create a real gap between the potential risk exposure construction professionals are facing and the cover afforded under their PI insurance arrangements. Certain sectors will also remain particularly challenging with insurers continuing to look closely at risk and claims profile. Any increase in market capacity also brings with it a question on motivation and particularly so when it comes to new entrants. No one wants to see a return to the poor behaviours that drove the hard market conditions and, as is so often the case, individual firms and their insurance