How does Secondary Professional Liability Insurance differ from Primary Professional Liability Insurance?

There are many benefits to being a member of the Ontario Society of Professional Engineers (OSPE),
from unique resources, to advocacy, to preferred pricing. It’s important to remember that your OSPE
membership also includes Secondary Professional Liability Insurance (Secondary PLI) coverage.

What is Secondary Professional Liability Insurance (PLI) and how does it differ from a Primary
Professional Liability Insurance policy?

Secondary Professional Liability insurance protects individuals against liability or allegations of liability
for injury or damages that have resulted from a negligent act, error, or omission that has arisen out of
your professional capacity as an engineer.

It is important to note that the Secondary PLI is intended to be an excess policy over and above a
primary professional liability insurance policy which a member may have through their employer or that
you secure independently for your Certificate of Authorization, and is not intended to replace a primary
insurance policy. A Primary PLI policy must be obtained by all Certificate of Authorization (C of A)
Holders, as part of the Professional Engineers Ontario (PEO) requirement to provide services in the
province of Ontario. This Primary PLI typically covers all engineers working and billing under the C of A
holder. In the event of a claim where the insurance limits of a Primary PLI policy are inadequate to pay
the legal fees and/or damages, the Secondary PLI supplements these incurred costs and protects the
individual engineer involved in the claim.

If you would like to secure a quote or receive more information with respect to a primary professional
liability insurance policy, please contact BMS Canada at 1-844-294-2717 or or visit their website

The following are claims scenarios where the Secondary Professional Liability policy could

Employed Engineer:
An employee of an engineering firm receives notification that a lawsuit had been filed against both himself and the engineering firm that he works for as a result of an error on a drawing that he reviewed
and stamped. The engineering firm reports this to their Primary Professional Liability Insurance provider and files a claim. As the case moves forward, it becomes apparent that the Primary Professional Liability Insurance limit is inadequate to pay for 100% of the damages. The individual engineer then files a claim under the Secondary Professionally Liability Insurance policy, which affords him an additional limit of $125,000 to cover his individual legal fees and damages owed for his involvement in the claim.

Dissolved Engineering Firm:
An engineer provided an assessment on the structural integrity of a barn. Several years later, the
claimant builds a second barn to the same specifications, relying on the original report provided by the
engineer. When the second barn subsided, a claim was initiated against the engineer who has already
retired; further, the engineering firm he had previously worked for is now dissolved. Fortunately, the
dissolved engineering firm-maintained run-off (inactive) primary professional liability coverage. In this
case, the claim was defended by the primary run-off insurance provider, but the claimant was extremely
aggressive and a six-figure lawyer’s bill was incurred. Had the run-off policy not been in place once the
Primary Professional Liability policy was cancelled, the retired engineer would have incurred these costs.
The Secondary Liability would respond to cover any additional legal costs incurred over and above the
defence costs limit included in the run-off coverage.

An Excess Layer or Secondary policy is exactly that: The Secondary Professional Liability Insurance policy is intended to supplement existing Primary Professional Liability Insurance–which members may hold through their employer or on their own. For more information regarding both Primary PLI and Secondary PLI, please visit the BMS Canada Risk Services website.

BMS Group is the exclusive broker for OSPE’s liability insurance program. For more information
contact 1-844-294-2717 or email

Leave a Reply

This site is protected by reCAPTCHA and the Google Privacy Policy and Terms of Service apply.