INDEMNITY INSURANCE ġ S.L.321.03 1
SUBSIDIARY LEGISLATION 321.03
INDEMNITY INSURANCE REGULATIONS
1st December, 1998
LEGAL NOTICE 251 of 1998.
Title.
Regulations.
Indemnity 
insurance.
Cap. 321.
2. (1) Every warrant holder or partnership registered under
the Engineering Profession Act shall be covered by an indemnity
insurance in terms of article 10 of the said Act.
(2) Such indemnity insurance shall also extend to cover claims
made within the five years immediately following the cessation of
the policy as a result of the retirement of or the surrender of or
suspension of or revocation of the warrant or special licence by any
partner or practitioner, and provided that the negligent act, error or
omission giving rise to the claim had occurred during the period of
insurance of the policy.
Transfer of 
insurance policy.
3. In the event that an insurance policy is transferred from
one insurer to another, the new policy shall extend to indemnify the
assured against any loss or claim made against the assured for a
retroactive cover for a period of five years in respect of any
negligent act, error or omission which has occurred, or is alleged to
have occurred, prior to the inception of the new policy, provided
that the assured is unaware of such loss or claim at the time of
completing the new policy, and such loss or claim has not been
notified under any other policy attaching prior to the inception of
the new policy.
Exemptions.
regulation shall not apply to any person who is the holder of the
warrant in respect of any specific period of time in which he has
retired or has not exercised the profession of engineer, and who has
before the commencement of such period informed the Board in
writing that during that period of time he will not be exercising the
profession of engineer:
Provided that the provisions of this subregulation shall not
be construed as exempting any person from the obligation to be
covered by an indemnity insurance (also known as Run-Off
Liability) for the further period of five years immediately following
any year in which he so exercised such profession.
(2) For the purposes of this regulation any person holding the
warrant of engineer who during a specified period of time does not
in any manner exercise the said profession, shall be exempt from
the obligation to be covered by an indemnity insurance.
Further policy 
conditions.
5. (1) The limit of indemnity shall be not less than Lm35,000,
and such limit of indemnity shall also be applicable to any one
claim and in the aggregate of each policy year, and shall be
2 ġ S.L.321.03 INDEMNITY INSURANCE
reinstated in the event of a loss:
Provided that a warrant holder or partnership of engineers
may, at any time, increase the relative insurance cover, and shall in
all cases increase such limit so as to be sufficiently covered in the
case of specific high risk or high value jobs.
(2) For the purposes of this regulation any defence and, or
settlement costs and expenses are to be paid by the insurer in
addition to the limit of liability.
(3) The insured is allowed to bear an excess for each and every
claim of not more than 1.5% of the indemnity limit under a
professional indemnity policy.
(4) In the event that the insurer is entitled at any time to avoid
this policy by reason of non-disclosure or misinterpretation by the
insured in their written proposal, the insurer instead of avoiding the
policy shall give notice in writing to the insured that they regard
the policy as of full force and effect save that there shall be
excluded from the indemnity afforded any claim which has arisen
or which may arise and which is related to circumstances which
ought to have been disclosed in the insured’s written proposal but
which were not disclosed to the insurer.
(5) Every warrant holder or partnership of engineers bound to
be covered by indemnity insurance shall each year, within a week
of taking out or renewing such indemnity insurance, inform the
Board in writing of the name of the insurance company and the
relative number of the insurance policy.
