A REVOLUTIONARY approach to insurance designed to eliminate legal disputes on partnering contracts is being proposed by the Association of Consulting Engineers and its broker Griffiths & Armour (G&A).
The proposals would see the adoption of one-off insurance policies to cover whole projects rather than individual companies insuring themselves against potential liabilities.
Under the plan, clients and insurers would become involved at the concept stage to assess risks including any financial loss.
Parties would waive their right to sue, and bear a proportion of the risk to an agreed level. Financial losses exceeding this would be covered by insurance.
'It's about insuring the team and insuring against risk not liability, ' said G&A partner Stephen Bamforth.
The ACE and G&A estimate that around £5M is spent on 'legal and forensic' costs for every £1M recovered in damages from professional indemnity policies. They claim their proposal would save huge sums by eliminating most legal disputes on contracts.