The benefits of using a broker to arrange your professional indemnity insurance
Professionalindemnity (PI) insurance provides cover for the legal costs and expenses indefending a claim, as well as compensation payable to your client if you arefound to be responsible for providing inadequate advice, services or designsthat cause your client to lose money.
Most businesses will use a broker toarrange their professional indemnity insurance, and here’s why:
- Abroker can give advice and also explain clearly what is and what is notcovered. A broker generally acts for the customer and has a legal duty of carein the advice and products provided
- Abroker can use their expert knowledge to highlight areas of cover that may nothave been considered.
- Abroker can ensure that you are not paying for more cover than you require andensure you receive excellent service.
- Aftera policy is sold, a broker can continue performing valuable day-to-dayservices, monitoring the adequacy of coverage limits and policy terms as marketconditions fluctuate.
- Inthe event of a claim, the broker can act on the businesses’ behalf to achievesettlement.
- Abroker can ensure that your business is presented to insurers in the correctway which allows insurers to offer the most appropriate products for a fairprice.
- Professionalindemnity policies require you to notify your insurers if you become aware of aclaim against you in relation to your professional activities, or you becomeaware of a circumstance which may give rise to a claim. A broker can providevaluable advice and guidance as to whether you should notify a claim orcircumstance to insurers.
Choosing the right broker
Professionalindemnity insurance is a specialist insurance and it is important to find abroker that specialises in this field. There are many general brokers that getinvolved in professional indemnity insurance, but their access to the marketcan be limited and they may not have the direct relationship with insurers thatis key for negotiating the right cover and price.
Aspecialist broker will know the right insurers to approach rather than floodingthe market which can have a negative impact on how your business is viewed bythe insurance market. They will also know how to correctly present your businesswith a view to getting the right cover at the right price.
Thesole reason for buying insurance is to ensure that claims are paid if and whenthey arise. If your business faces a claim for professional negligence it canbe a time consuming, expensive and confusing process, and the relationshipbetween you and your broker is integral to getting the claim dealt withefficiently.
Selecting the right insurer
Itis important to check the financial strength of an insurer before purchasingyour policy and your broker should be able to advise you on this. Whilstpremium is an important factor, the financial strength of an insurer and hencetheir ability to pay claims should the need arise, should be a key part of thedecision making process.