Approved inspector finance for building control approvers

For most professions the PII premium is a large annual bill. For a building control approver it is closer to a licence to trade. Without suitable cover an approver cannot take on new work, and if cover fails mid-project, live jobs can revert to the local authority with fees and clients lost. Firms in the sector remember 2019, when insurer withdrawals left several approved inspectors unable to renew and forced some to stop accepting new projects.

Three features make the premium harder to fund than in other professions:

• The liability tail is long. A final certificate issued today can be questioned for many years, so cover on completed work, and run-off cover if a firm stops trading or is sold, has to be priced and paid for well after the fee was earned.
• The market is thin. Few insurers write this class, so a claim notification or a move into more complex building types can move the premium sharply at a single renewal.
• It cannot be delayed. The renewal date is fixed and a lapse stops the business, which is why firms often need the money arranged before the quotation is even final.

Our page on PII premium finance compares spreading the premium through the insurer's finance provider with using a business loan. For an approver, the cancellation clause in policy-linked finance deserves particular care: a missed instalment could end cover rather than simply create a debt.

• Registration and competence: each inspector must be registered at a class reflecting their competence, assessed against the Building Inspector Competence Framework. Validation fees, training and time away from site fall on the employer.
• Recruitment: registered inspectors, particularly at the higher classes, are scarce and salaries have risen. Winning a large housebuilder's programme usually means hiring first.
• Fee timing: fees are commonly split between plan assessment and a site inspection element spread over the build. On long or stalled schemes, inspection costs continue while the next fee stage waits for the client's programme.
• Compliance systems: the professional conduct rules for registered building control approvers and the operational standards bring record-keeping, reporting and quality management costs, often through new software.
• Lost work: the BSR is the building control authority for higher-risk buildings in England, so approvers that relied on taller residential schemes have had to replace that income.

Borrowing to pay a premium that keeps rising only postpones the question of whether the work mix is priced correctly. If the renewal has jumped because of a claim or a move into complex buildings, review fee levels before committing to a loan that assumes the old margins. Where a tax bill is the real pressure, HMRC's Time to Pay may cost less than a loan; our Time to Pay versus tax loan comparison sets out the difference. Directors thinking about selling should budget for run-off early, since it can be a large cost that falls at exit.