Claims are increasingly made against persons or firms engaged in professional duties or the provision of such services for alleged negligence, omission or error. Consequently insurance protection is sought by two groups:
Those exposed to the risk of causing bodily injury (doctors, surgeons, dentists, pharmacists, etc)
Those who may cause financial loss (architects, solicitors, IT professionals, etc)
The term Errors and Omissions (E & O) is sometimes used for policies issued to those who may not necessarily be qualified by a trade or recognized examination.
Some occupations (e.g. insurance brokers, solicitors, chartered surveyors) are required by law to have this cover and over time leading insurers have developed specialist policies particular to certain trades.
A professional person owes a duty of care to clients, they will be liable for losses resulting from a breach of this duty or negligent misrepresentation. Following the introduction of the Misrepresentation Act 1967, courts also have the power to award damages in lieu of recession.
Where a business ceases trading or is sold, the outgoing owners still have a ‘run off’ liability and this type of cover can be purchased, usually at a reduced premium. In circumstances where new owners are accepting the run off liability, it is essential that their insurers are fully aware of the situation to maintain adequate cover.
Frequently Asked Questions
Who is this cover best for?
Accountants (both ICA and Non-ICA)
Surveyors and Property Managers
However, we also provide Professional Indemnity policies for a range of additional professions including Directors and Officers, Marketing and Media Consultants and Photographers among others.
What’s the difference between professional indemnity and public liability?
Professional indemnity insurance covers against allegations of professional negligence – which means it would cover you if you were to make an error or mistake in a piece of work (such as a project or report) for a client.
Public liability insurance is different – it covers against allegations of injury or illness caused to third parties by your negligence. This includes many of the slips, trips and falls that are associated with personal injury claims. In addition, public liability insurance covers against damage to third party property – for example, if you were to damage a client-owned laptop or smartphone.
As they insure against different scenarios, it’s important you consider arranging both types of cover to ensure you are properly protected.
What is retroactive cover?
Retroactive cover means your insurance covers you from the date you first bought a professional indemnity policy, even if this policy was placed with another insurer. This is subject to the fact that you kept a record of your previous policies and maintained continuous cover from policy to policy.
The benefit of retroactive cover is that if you need to make a claim for an event that happened before the start of your current policy and the date of the alleged error or omission falls within the retroactive period, this will be covered subject to other policy terms and conditions.
What is a retroactive date and what does that mean for our policy?
In most cases, this will be the date you first purchased your Professional Indemnity Insurance policy. The purpose of a retroactive date is to confirm the date from which your past work is being covered.
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The policy indemnifies the insured against claims for damages and claimants’ costs for breach of professional duty due to negligence, error or omissions made against the insured during the period of insurance.
Cover can be arranged in two ways:
Any One Claim
Cover is limited per incident but you could find yourself subject to more than one claim in the period and this would be covered.
Cover is limited for any one claim but also during the period of insurance. In the event of multiple incidents and the limit being reached, cover will cease. Excess Layers in the event that the limit of indemnity is insufficient, excess layer policies can be purchased. In these circumstances it is essential that all insurers follow the wording of the primary policy to facilitate smooth handling of claims.
The limit of indemnity expressed normally applies to damages and the claimants costs. The Insured’s costs, provided that they have been incurred with the insurers consent, are in addition.
Territorial limits vary but the policies generally apply on a worldwide basis although Insurers may insist on any action being brought to the UK courts.
The policy contains familiar conditions such as claims notification etc but certain conditions call for a specific comment.
The Insurer retains the right to control all claims but undertakes not to exercise subrogation rights against employees unless the erring employee has been convicted for dishonest behaviour.
Policies provide a form of arbitration in the event of a dispute between the insured and the insurer as to whether the claim should be contested or disputed.
Discovery provisions vary but you will be required to notify insurers immediately of any claim, regardless of merit. Any subsequent development of a claim will then be deemed to have been within the period of insurance.
Records of gross fees should be maintained as a declaration will be required and the premium adjusted accordingly.
Libel & Slander
Dishonesty, fraudulent, criminal or malicious act or omission of employees
Partners previous business
Extended cover/Run off Cover
Cover for Documentation
Breach of Warranty of Authority
Excess or deductible
Bodily injury/Property Damage
Circumstances not disclosed to the Insurer
Rating and Underwriting
The premiums are calculated on the fee income but variables such as profession, qualifications, experience, claims history etc all have an impact on rating. An annual declaration will be required in respect of fee income generated.
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Working With Us
Which Services will we Provide you with
The Business Insurance Bureau conducts both client and market research to identify solutions to the needs of an almost exclusively business clientele. We will make a recommendation once we have assessed your demands and needs.
All premiums due to insurers must normally be paid by you on or before the date that cover commences. Where alternative methods of payment are available these will be discussed with you so that arrangements can be put in place by the due date.
Confidentiality & Security
We are registered with the Data Protection Registrar. We will ensure that any information obtained from you is treated by us and anyone else involved in arranging, considering to arrange or managing your insurance, as Strictly Private and Confidential. We will not provide your information to anyone else unless we:
have your permission to do so, or -are required to by the FCA, or -are required to do so by law, or -are required to do so in the normal course of arranging or negotiating and maintaining, or renewing financial services products which we may from time to time approve.We take appropriate steps to ensure the security of any money, documents, other property or information handled or held on your behalf.
All information in any form, with the exception of policy documents and certificates issued on behalf of insurers and supplied by us, to you, should be treated as Strictly Private and Confidential and not be released directly or indirectly to any other party, without our explicit consent.
Note: in transacting your insurances with The Business Insurance Bureau, you are deemed to have accepted our Terms of Business. Your accepting of these Terms of Business does not affect your statutory rights.
You must notify us as soon as possible of a claim and circumstances which may give rise to a claim. In the event of a claim you should contact this office and we will promptly advise you and if appropriate, issue you with a claim form and pass all details to your insurer. You should not admit liability or agree to any course of action, other than emergency measures carried out to minimise the loss, until you have an agreement from your insurer. We will remit claims payments to you as soon as possible after they have been received on your behalf. In the event that an insurer becomes insolvent or delays making settlement we do not accept liability for any unpaid amounts.
You would have the right to cancel a policy within 14 days of its inception or upon receipt of the policy documentation whichever is the later. You would as a Consumer and without providing a reason, cancel the policy by confirming this is in writing to the address of our office through which your policy was placed. Any policy documentation and in particular any legal document, i.e. Certificate of Motor Insurance, Employers Liability Certificate, MUST be returned with your instruction to cancel. By exercising your right to cancel the policy, you are withdrawing from the contract of insurance.
Duration & Termination
Our services may be terminated without cause or penalty by giving one months’ notice in writing. In the event that our services are terminated by you other than at the expiry of the policy we will be entitled to retain any fees and all of the brokerage payable. The responsibility for handling claims reported after the date of termination shall in the absence of an express agreement be the responsibility of the party taking over the role.