Performance Solutions, Repeated Declines, and Why Fire Engineering PI Lives or Dies on the Underwriter Conversation

If you write fire safety reports, design Performance Solutions, specify sprinkler or smoke management systems, or assess BCA Section C/E compliance, your Professional Indemnity insurance is the policy that responds when your engineering is questioned after the fact.

The “after the fact” part is the problem. Fire engineering rarely gets tested under normal conditions. Your report sits in a development file for years until a certifier flags a non-conformance, an insurer disputes a strata claim, or - in the worst case - an actual fire happens and the coronial investigators want to read your assumptions. That’s when the PI policy has to do its job.

At Tank Insurance, we place fire engineer PI across consulting practices, fire safety assessment firms, and combined HVAC and fire safety operations. Here’s what the market actually looks like in 2026 and what the cover needs to do.

What does a fire engineering consultant actually do - and where’s the PI risk?

The work spans a spread of services that each carry a different claim profile.

Service area	Typical PI trigger
NCC/BCA Performance Solutions	Certifier rejection, post-completion rework, or fire event investigation finding the engineered solution inadequate
Fire safety reports and BCA Section C/E compliance	Compliance non-conformance discovered at occupation certificate stage or annual fire safety statement
Sprinkler and smoke management specifications	System fails to perform during commissioning tests or in an actual fire event
Egress modelling and tenability analysis	Evacuation assumptions challenged after an incident or a change-of-use review
Cladding assessments and external wall reviews	Combustibility test results, cladding sublimit disputes, post-Grenfell rectification claims
Fire engineering peer review and expert evidence	Methodology challenges, conflict-of-interest disputes, expert witness exposure
Annual Fire Safety Statement (NSW) and AESMR (other states)	Sign-off liability where assets later fail inspection

The common thread runs the same way as it does for acoustic consultants: your report or model produces a real-world outcome that either holds up or doesn’t. When it doesn’t, the rectification cost can run far beyond the original consulting fee.

The placement reality - why fire engineering keeps getting declined

Fire engineering doesn’t fit a standard occupation code. The work mixes engineering design, on-site assessment, and sometimes installation oversight. Most generalist underwriters look at the activity list and decline.

Across recent Tank fire engineering and fire safety submissions, the response pattern looks something like this. These are illustrative aggregates from recent placements, not a controlled survey:

That’s roughly a one-in-two straight decline rate before any negotiation, plus another tranche gated behind professional body membership. The market hasn’t softened. If anything, it’s tightened since the cladding rectification wave that followed the Lacrosse and Neo200 decisions.

The placements that succeed go through specialist underwriting agencies and require a different conversation - one that breaks the work into its actual components rather than pushing it through an occupation filter.

The regulatory landscape fire engineering consultants work in

Fire engineering sits at the intersection of building, professional, and statutory regimes. A PI policy needs to respond to claims arising from any of them.

NCC Section C and Section E - and the Performance Solution pathway

The National Construction Code sets fire safety performance requirements through Section C (Fire Resistance) and Section E (Services and Equipment). Compliance is demonstrated either through Deemed-to-Satisfy provisions or through a Performance Solution that meets the underlying Performance Requirements.

Performance Solutions move the compliance case onto the engineer’s report. Modelling, fire engineering analysis, and tenability calculations sit at the centre. If a certifier rejects the solution at occupation certificate stage, or if a fire event triggers post-incident review, the Performance Solution report is read closely. PI responds to the resulting professional negligence allegations.

State engineer registration regimes

• QLD: the Board of Professional Engineers Queensland (BPEQ) administers the Professional Engineers Act 2002, requiring registration for engineering services performed in Queensland
• NSW: the Design and Building Practitioners Act 2020 creates statutory duties of care for design work on Class 2 (and now Class 3 and 9c) buildings, with PI requirements set under the Regulation
• VIC: the Building Act 1993 amendments and the Professional Engineers Registration Act 2019 require registration in defined engineering areas
• WA, SA, TAS, ACT, NT: various registration and recognition schemes apply, often requiring a recognised practice or chartered status

PI needs to respond to claims under all jurisdictions where you accept work. Engagement letters that don’t specify the jurisdiction can blur this.

Industry accreditation and underwriter expectations

The Fire Protection Association Australia (FPA Australia) runs the FPAS accreditation scheme covering Fire Safety Assessors, Fire Safety Practitioners, and other roles. Some specialist underwriters require FPAA membership or NFIA accreditation before they’ll quote. Engineers Australia chartered status (CPEng) and RPEQ in Queensland also factor into underwriter appetite, particularly for Performance Solution work.

Australian Standards in scope

The standards that surface most often in fire engineering claims include AS 1851 (routine servicing of fire protection systems), AS 2419 (fire hydrant installations), AS 3959 (construction in bushfire-prone areas), and AS 4655 (fire safety audits). PI policies cover the work referencing these standards but they don’t insure against deliberate non-compliance.

The dominant claim patterns

Fire engineering claims tend to fall into three patterns.

1. Post-incident scrutiny after an actual fire

A fire occurs. Investigators (insurer, fire authority, coroner, civil claimants) read every fire engineering report relevant to the building. Tenability assumptions, smoke management modelling, and Performance Solution rationale all get tested. Even when the engineering is sound, defence costs to demonstrate that to a court or coroner can be substantial.

2. Performance Solution rejection at occupation certificate stage

A certifier refuses to issue an Occupation Certificate because the Performance Solution is incomplete, methodologically weak, or misaligned with the as-built construction. The developer or builder seeks recovery for delay costs and rework. This is where most pre-incident PI claims emerge.

3. Cladding and external wall rectification

Post-Grenfell, the rectification market has produced a long tail of claims around external walls. Reports that opined on combustibility, materials, or fire spread between buildings are still being audited. Cladding sublimits and exclusions in PI policies are now standard. Practices working on residential or aged care need to read these clauses carefully.

The cost asymmetry is the killer. A $5,000 fee for a fire safety report can produce a $500,000 claim if the building has to be re-clad or the smoke management system rebuilt.

Tank’s experience placing fire engineering PI

Tank Insurance places PI and PL for fire safety engineering practices, fire protection consultancies, and combined HVAC + fire safety operations. The placements have a few consistent themes:

• The decline rate is real. Across recent Tank fire engineering placements, between three and five insurers typically decline before the brokered submission lands with a specialist underwriter. The standard market doesn’t have appetite for the occupation.
• Specialist agencies do the heavy lifting. Markets like Woodina, Arena, Liberty, Global Underwriting, and Keystone are the ones we see writing this risk - sometimes on cladding-extended terms, sometimes with sublimits, sometimes referred to a specialist underwriter inside the agency.
• Splitting cover is often the right answer. When a single occupation code can’t capture the work, splitting PI from PL - or splitting fire safety from HVAC - lets each policy go to an underwriter that actually rates the activity.
• Practice size and accreditation matter. Two-staff consultancies with FPAS-accredited principals are rated more favourably than larger generalist firms whose fire engineering work isn’t accredited.

We’ve documented two of these placements in detail.

Case study one - NSW fire protection consultancy: A two-person fire protection consultancy with around $250,000 turnover needed $1M PI for fire safety reports, sprinkler specifications, and NCC compliance. Three of four insurers declined on occupation. Woodina reviewed the consulting scope and quoted at approximately $1,700 gross premium, with the underwriter clearly defining the activities the policy would respond to. The full case is on the fire engineer service page.

Case study two - Sydney HVAC and fire safety firm: A Sydney mechanical services firm specialising in HVAC and Fire Safety Engineering hit the renewal market and was declined by five major underwriters in succession. Annual turnover was $1.2M, with leadership holding CPEng and RPEQ credentials. We deconstructed the turnover, separated Project Management from Fire Safety Engineering and HVAC Air Balancing, and worked the risk into a structured solution with specialist agencies. PI was secured at approximately $7,000 including broker advocacy fee. The full case is at HVAC and fire safety engineering case study.

Both placements share the same lesson: the policy that gets bound is the one where the underwriter understands the work, not the one where the occupation code matches a drop-down menu.

What the policy actually needs to do

Retroactive date

PI is claims-made. Fire safety reports often surface in claims years after the original engagement - either because a fire occurs or because a building hits a 10-year defect window under state legislation. A retroactive date that reaches back to the start of the practice (not the inception of the current policy) is essential. Switching insurers without preserving the retroactive date leaves past work uninsured. Our retroactive cover guide walks through how this works.

Run-off cover

Fire engineering practices wind down, sell, or merge. Run-off extends the PI for claims arising from past work after the practice has ceased trading. Without it, the principal carries personal exposure for any claim that surfaces post-closure. The NSW DBP Act’s statutory duties run to owners and successive owners with long limitation periods. The run-off cover guide covers the mechanics.

Cladding and external wall handling

Many policies sublimit or exclude cladding work. Others require the underwriter to be told explicitly what’s in scope and what testing has been done. The wording typically asks whether external walls are defined as cladding within the policy, and whether combustibility is assumed when no test data exists. Read these clauses before you sign.

Performance Solution scope

Performance Solutions sit at the high end of fire engineering risk. The policy’s Professional Services definition needs to include them explicitly. A policy that defines Professional Services narrowly (eg “fire safety inspections”) may not respond to a Performance Solution claim.

Statutory liability cover

The NSW DBP Act, QLD BPEQ regime, state building authorities, and WHS regulators all create statutory exposure. A policy that includes reasonable statutory defence costs is materially more useful than one that doesn’t.

Contractual liability assumed by agreement

Tier 1 contractor agreements often impose fitness-for-purpose warranties, indemnities, and liquidated damages tied to commissioning tests. PI policies typically cover liability you’d have at common law, not the extra liability you contractually assumed. The gap shows up in dispute.

What it costs

General market ranges based on 2026 placements:

Premiums depend on turnover, claims history, project mix (Class 2 residential and cladding work are rated higher), accreditation status, and whether the practice does Performance Solutions or stays inside Deemed-to-Satisfy compliance work. PI for engineers more broadly has been rising for several years - we covered the drivers in why PI costs are rising for engineers.

Common mistakes fire engineering consultants make with PI

1. Assuming a generalist engineer PI covers fire engineering work. A standard consulting engineer policy may exclude or sublimit fire safety scope. Read the Professional Services definition.
2. Letting the retroactive date drift forward at renewal. Fire engineering claims surface years after the work. A retroactive date gap is the most common cause of an uninsured claim.
3. Signing principal contractor terms without reading the indemnity clause. Tier 1 contracts widen the contractual liability beyond what PI covers. The premium and the policy wording need to match the contracts you actually accept.
4. Treating cladding sublimits as boilerplate. Cladding clauses vary widely. Some are workable, some are punitive. The placement broker should walk through each one before binding.
5. Going to renewal without disclosing Performance Solution work. Underwriters who learn about Performance Solution scope at claim time may dispute cover. Disclose it at placement.
6. Skipping FPAS, RPEQ, or DBP registration where required. Not having the right registration is a regulatory issue and a coverage issue - some policies require you to maintain qualifications as a condition of cover.

Frequently Asked Questions

Do fire engineering consultants need PI insurance?

Yes. Principal contractors, certifiers, and state regulators (particularly under the NSW DBP Act and QLD BPEQ regime) require fire engineering practitioners to hold appropriate PI cover. More importantly, the claim risk from a single Performance Solution dispute or post-incident investigation can exceed the practice’s ability to self-insure.

Can I be sued personally as a fire engineer if my company holds the policy?

Yes. The NSW DBP Act creates statutory duties of care that run to individuals as well as companies. Even outside that regime, claimants often name the engineer personally. PI policies typically cover the company and its directors and employees acting in their professional capacity, but the wording matters.

What’s the difference between fire engineering PI and acoustic consultant PI?

Both sit in the engineering consultancy market and both involve Performance Solutions under the NCC. The pricing and underwriter appetite differ - fire engineering carries higher life-safety exposure and a different decline pattern. The placement mechanics are similar enough that we’ve covered the cluster questions in the acoustic consultant PI guide and the PI FAQs for engineers.

How does PI interact with Public Liability for fire engineering work?

PI covers financial loss from your professional advice. Public Liability covers third-party injury or property damage - relevant when you attend site, conduct fire safety inspections, or use testing equipment. Most fire engineering practices need both, often at $20M PL because of Tier 1 builder requirements. Our PI vs PL guide walks through the split.

What happens if my fire engineering report contributes to a fire investigation?

The PI policy’s defence cost provisions respond to claims and investigations alleging professional negligence. Coronial inquests, fire authority investigations, and civil claims following a fire are all scenarios where the policy is intended to fund legal representation. Read the policy’s investigation and inquiry extensions carefully - some are broader than others.

Need PI for your fire engineering practice?

Tank Insurance places Professional Indemnity for fire safety engineers, fire protection consultancies, and combined HVAC + fire safety firms across Australia. We understand the decline pattern, the specialist underwriter map, and the way Performance Solution work needs to be presented at submission.

Call us on 02 9000 1155 or email [email protected].

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This is general information only and does not take into account your objectives, financial situation, or needs. You should consider whether the information is appropriate for you and read the relevant Product Disclosure Statement (PDS) before making any decisions about insurance products.