Firms regulated by the Royal Institution of Chartered Surveyors (Rics) are to require Professional Indemnity (PI) insurance, it has emerged.

The insurance coverage is a mandatory feature of the institution's new guidance for regulated firms.

Rics adds that it is the first time in its history that such a requirement has been made of companies wishing to comply with regulation.

While previously individuals regulated by Rics were required to hold PI cover, the institution explains that the new guidance insists that policies apply to the firm as a whole.

"Firms will be regulated for those matters that are dealt with at firm level such as PI insurance and complaints handling procedure," the guidance states.

"These clear and simple rules are the culmination of a root and branch review of Rics' regulation."

Under the terms set out in the guidance document, firms are required to hold "adequate and appropriate" PI coverage which meets approved standards.

This is expected to apply to all current and previous work, according to Rics.

However, Angus Ogg of specialist Lloyd's broker PYV commented that in reality, PI is generally purchased at firm-level and not by individuals, so most will not need to change their policies.

When a complaint is received, the institution suggests that firms should contact their PI provider as soon as possible in order to avoid exacerbating the situation.