PII Renewals

Professional indemnity insurance renewals can be challenging for firms with a claims issue.

There are three areas where we can assist you in conjunction with your brokers.

First, Insurers may be wary of renewing – or taking on a new firm – if the insured faces the prospect of multiple claims arising from a rogue partner, or notorious areas of repeat work. One such area is investment schemes, typically student lets or hotel units. Other work-types we encounter are ground rents and leasehold-related issues, under-settlement of industrial disease claims, and defects in wills and powers of attorney. An error or omission may be repeated through a large number of cases handled by the same fee-earner or members of the same team.

A professionally crafted block notification is therefore an important tool in the broker’s armoury. The aim is to park all claims arising out of the circumstances with the firm’s current insurer, with a view to going into the marketplace with a clean slate, or persuading the current insurer that renewal is the best hope for recouping their loss. It may also protect the firm from an uncapped excess.

However, it is important that the notification is tailored to the policy wording in question, the law on the subject, and, so far as possible, anticipates the claims which may arise.  Our long experience of advising on these issues, and in defending professional liability claims, is invaluable.  As we are practising solicitors, our legal advice on insurance law will generally be protected by legal professional privilege.

The second area where we assist firms is in providing a professional risk report, which is a review of their risk profile.  We carry this out by reviewing written procedures, interviewing key staff and online questionnaires.  The report will provide insurers with a fuller picture than would be provided in a proposal form, and helps identify key controls which the firm has put in place to manage risk.

Finally, successor practice issues can rear their ugly head at renewal time, and this is an issue on which we have considerable experience, having advised several hundred firms and insurers since the provisions came into force in 2000.