Professional indemnity insurance is a popular business insurance policy among contractors and those offering professional advice and/or services.
There are time limitations that apply for claimants looking to issue negligence proceedings, for the majority of negligence claims the time limit is 6 years following the date of the negligent act. There are certain circumstances in which the time limits would differ if the negligence only becomes apparent at a later date. It is possible to bring a claim outside the six-year limitation period if the damage complained of was not discovered until after the expiry of this period. This is known as 'latent damage', and in these circumstances the claimant has three years from either the date of knowledge of loss or the date when it ought to have reasonably known about the loss. What constitutes what 'ought reasonably to have been known' depends on the circumstances of the case, and specific advice should always be sought. There is a final time limit of 15 years from the date of the defending party's negligent act or omission.
It is difficult for a negligence claim to be brought against a company that has ceased trading and has been closed, however, there are certain circumstances in which a court can order the company to be restored to the register and for a claim to be pursued against it. This will depend on specific circumstances (for example: if you had knowledge of a claim, or potential claim, at the time the company was closed, amongst other factors) and specific advice should be sought (i.e.from a solicitor).