Contracts & tenders
Professional Indemnity requirements in tenders and RFPs
How to read and respond to the PI insurance clauses in a tender document, and what to check before you bid.
Key takeaways
- ✓Tender documents frequently specify a minimum limit of indemnity, and sometimes a specific structure or minimum period of run-off cover
- ✓Public-sector and SOE tenders in South Africa commonly set higher minimums than typical private-client contracts
- ✓Confirm you can actually obtain the specified limit, structure and territorial or jurisdiction terms before submitting a bid that commits you to them
- ✓Starting the insurance conversation only after winning a tender is a common and avoidable mistake
What tender PI clauses typically specify
A minimum rand limit, occasionally whether it must apply per claim rather than in the aggregate, a minimum number of years of run-off cover to be maintained after project completion, and sometimes a requirement to name the client as an interested party or to provide a formal certificate of insurance.
Public sector and SOE tenders
These often set materially higher limits — frequently in the R5,000,000 to R10,000,000 range or above for larger infrastructure work — and stricter proof-of-cover requirements than typical private-sector contracts. See our R5,000,000 and R10,000,000 cover pages for the detail on what typically sits at these tiers.
Checking feasibility before you bid
For refer-only professions, or unusually high required limits, get written confirmation from your insurer or broker that the required limit and structure are actually obtainable before submitting your bid — not after you've won. Losing a contract because cover couldn't be arranged in time is entirely avoidable with early engagement.
Providing proof of cover
Most tenders require a current certificate of insurance, or a broker's letter of confirmation. Keep this documentation current and ready to produce on short notice, since tender deadlines rarely allow much lead time.
FAQ
Frequently asked questions
Ask your insurer or broker whether your limit can be increased for the duration of the specific contract, either permanently or via a temporary endorsement.