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Maintaining your professional indemnity insurance during Covid-19

The necessary steps the government has taken to slow the spread of the coronavirus outbreak in the UK has undoubtedly had its effect on the business community, with many firms suffering reduced income and facing financial uncertainty.

Clearly, ICAEW members are not immune and it is sadly inevitable that some will be facing financial difficulty, and therefore seeking to reduce overheads.

At Marsh Commercial we understand that, for some, annual insurance renewals or monthly payments will be cause for concern – there is a clear need to keep insurance cover in place but premium payments may represent a serious strain on already stretched finances.

So, what can those in financial difficulty do to balance these two pressures?

What to do if you are struggling with insurance premium payments

There are two options here, depending on whether you pay your premiums as one annual payment or by monthly instalments:

1. If you pay your professional indemnity and other insurance premiums as one annual payment: Contact your dedicated Marsh Commercial account handler to discuss your situation. We will work on a case-by-case basis with ICAEW members and do our utmost to assist those facing financial difficulty at this unprecedented time. Where possible, we will assess whether premiums can be reduced, or help you set up monthly payments to spread the cost – to ensure you remain protected while reducing the financial burden.

2. If you pay your professional indemnity and other insurance premiums in monthly instalments: Our premium finance partner, Close Brothers Premium Finance, has committed to work with ICAEW members facing financial difficulty on a case-by-case basis. The team is working hard to assist during this difficult time and ask that any ICAEW members concerned about premium payments to get in touch on 0333 321 8567 or email customerservicespf@closebrothers.com.

Remember, simply cancelling insurance payments is not advised, as this may invalidate your insurance cover, leaving your business exposed to further financial risk.

What to do if you are forced to pause trading

Ceasing cover during a business “pause” could leave you exposed to potentially expensive claims – even historical claims – without insurance cover in place to help with defence costs and compensation. That is because professional indemnity insurance is written on a “claims made” basis, which means that cover must be in place at the time of a claim, not at the time of incident that a claim arises from.

With that in mind, it is very important to maintain your professional indemnity insurance cover even during a business pause. However, it may be possible to reduce or spread your payments as monthly instalments - please refer to the guidance above or get in touch with your Marsh Commercial account handler for further advice.

What to do if you’ve no choice but to cease practicing

We understand and sympathise with any ICAEW members forced to cease practicing, but we would not recommend cancelling your professional indemnity cover altogether. ICAEW policy stipulates that members hold a minimum of two years run-off cover and ideally six years – to help protect against historical claims following business cessation.

Any ICAEW member with professional indemnity insurance taken out through Marsh Commercial can quickly and easily arrange up to six years run-off cover - please contact your dedicated Bluefin account handler for advice or to secure the appropriate level of cover.

Here to help

Your dedicated Marsh Commercial team is here to help. Whether you are struggling with premium payments or need guidance on insurance issues more generally, get in touch on 0117 908 4074 or email enquiry.professions@bluefingroup.co.uk. Marsh Commercial is a trading name of Jelf Insurance Brokers Ltd. Jelf Insurance Brokers Ltd is authorised and regulated by the Financial Conduct Authority (for details see marshcommercial.co.uk/info/terms/). Not all products and services offered are regulated by the FCA. Registered in England and Wales number 0837227. Registered Office: 1 Tower Place West, London EC3R 5BU.

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