Statutory Liability - Part of your Business Insurance

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Author

LPMS Admin

Published On

06/09/2016

Category

Advice to Surveyors, Advice to Quantity Surveyors, Advice to Valuers, Business Advice

On 4 April 2016 the Health and Safety at Work Act came into force.  There has been much discussion regarding the potential implications for Consultants working in the Land Development field, but there has been limited information provided on what actions consultants need to take.  No doubt in time, industry advice will be provided on how to best deal with the potential new responsibilities, but until then it is up to each practice to decide what practical steps need to be taken.

It is possible that practices with good health and safety systems will already be compliant with regards to health and safety matters affecting their own staff.  They may however, need to consider the appointment of a Health and Safety Representative to provide representation for staff members directly.

With regard to projects, practices need to consider how they will respond to the requirements of Safety in Design and how to ensure contractors and interested parties are informed of relevant safety matters during the design, construction, use and demolition of a building.  At the very least a means of recording potential hazards known to the project manager or the engineer, will need to be created which can be passed on to the contractor, the client and if warranted the Territorial Authority.  It is likely different processes will need to be devised for how to respond to large and small projects.

Practices also need to be aware of the statutory requirement to notify WorkSafe NZ if a notifiable event occurs. This is defined in the Act.

It is recommended all practices refer to the MBIE website for the latest information on the Health and Safety in Work Act and attend relevant training when it becomes available.

In the unfortunate event of an incident occurring that affects your practice, then a Statutory Liability Policy may offer some relief.  Statutory Liability policies are designed to provide protection to businesses for

  • Defence costs associated with alleged unintentional breaches of the Building Act, Consumer Guarantees Act, Fair Trading Act, Privacy Act and most other statutes affecting commercial activities.  The notable exceptions are police prosecutions and taxation legislation.
  • The costs of representation at an investigation or inquiry.
  • Fines and (or) cash penalty payable by the insured following conviction for an offence under the insured statutes (except under the Health & Safety at Work Act 2015).

For Surveyors this cover is particularly pertinent in respect to

  • Health & Safety at Work Act 2015 court ordered reparations
  • Resource Management Act 1991

As with all insurance policies, the extent of the coverage afforded varies and hence it is vital that you read the policy and understand the terms and conditions.  If you do not understand or are unsure, talk to your broker who will be able to assist.

Who is Protected?

A typical policy looks to provide protection to the:

  • Company, including any declared subsidiary, for its own liability.
  • Company, by way of reimbursement to the extent that the company has directly indemnified any officer as it was legally obliged or permitted to do so.
  • Officers, which includes directors, managers and employees, in that capacity, to the extent that the company has not directly indemnified them.

For additional detail on Statutory Liability Insurance, we have a brochure to assist.

Insurance Implications

With this increased scrutiny, it will become more important than ever to arrange appropriate insurance that will take on the responsibility for managing and funding an effective defence.  Whilst Health and Safety fines cannot be insured, insurance can still provide valuable cover for legal costs of defence and reparations.  We recommend Statutory Liability policies be reviewed to ensure optimal cover and appropriate limits of indemnity insurance for New Zealand.

Interested?

If you would like to take advantage of these policies, you can apply to become a member of LPMS.

LPMS offers Professional Indemnity Insurance (and other insurance products) to Valuers, Land Surveyors and Quantity Surveyors, who are members.  If you are interested in becoming an LPMS member to take advantage of this, read more about the benefits of membershipcontact us today or apply online to become a member.