Case Study Design and Construct

Professional Indemnity insurance is an important part of many professionals' business risk management.

We asked successful professionals in key sectors about their business, and where PI fits into the work they do.

Stephen Groom, managing director, LP Construction

What does your business do?

LP Construction offers a complete building service for domestic and commercial clients and corporate bodies. We're based in Margate, Kent and cover every aspect of building works, including New Build, and have Corgi-registered plumbers and NIC-registered electricians. We work closely with the local council and conservation department, have been nominated for conservation awards for our work in Margate Old Town, and have recently completed major works on Margate Harbour.

What kind of risks do you have to think about in the day-to-day running of your business?

General site safety is the main concern. Sites have to be organised and kept tidy, and when working with the public we have to make sure it's safe for them to walk around. I also have to ensure that contractors' work doesn't overlap, for example not having electricians and plumbers working in the same place at the same time.

How did you find the right level of Professional Indemnity Insurance cover when you set up your business?

I set the business up 18 months ago and have always had public liability cover. As the business expanded, it was my accountant who advised me to invest in a PI policy which I now have in place, and we obviously adhere to all legal and health & safety requirements.

What are the key benefits of PI cover for builders?

Security and peace of mind. There are people out there who don't have it and that's dangerous for everyone. Those of us who do have it and take it seriously might be more expensive than builders who cut corners but that's because we have to pay for these insurance policies! It makes sure that everyone is covered whether it's a problem with a client, one of my employees or something I've done.

What aspects of your business or services that you provide are most open to risk?

Any work that is done in a public area presents a potential risk. For example, we recently worked on the roof of a block of flats in a busy high street. Even though we install scaffolding and netting we have to make sure that no objects or materials can fall and cause injury to the general public going through. And for domestic projects it's houses full of kids! It's really shocking how some parents let their kids run around in building areas unsupervised and it's us who then have to take additional responsibility for their safety.

What are your customers' greatest concerns, and how does PI help protect your reputation?

Time, sticking to the budget - and mess! Those are the big three which means that we have to work efficiently to plan and tidy up after ourselves.

What's the most interesting case of a negligence claim or horror story you've heard of in your industry?

The very risky bodge jobs are usually to do with builders doing work on the cheap – not using the correct materials to the right specifications, such as using wooden joists where steel is required, and making it look good. On one job where we were hired to do a complete roof refurbishment, when we took off the plaster boards we discovered that all the main structural supports were missing or in the wrong place. The roof could have come down completely and caused serious injuries.