A hard insurance market is characterised by high demand for cover and a lower supply. Over the past few years, various large-scale catastrophes throughout the UK - such as the Grenfell tragedy and the collapse of Carillion, natural disasters, unexpected insolvencies and broken supply chains - have caused a significant increase in Professional Indemnity (PI) claims.
The UK’s hardening PI market has made it increasingly difficult for organisations to secure adequate levels of cover. It has even resulted in some insurers deciding to leave the PI industry altogether.
Despite the harsh implications of the hardening PI market, by taking control of your insurance renewal, you can help your organisation maintain adequate cover at a reasonable price.
- Communicate with your broker: Make sure you meet with your broker to discuss what level of cover and unique policy features your organisation needs. After all, your broker has the insurance expertise to provide you with the most cost-effective, high quality cover solutions. Ensuring frequent communication with your broker will help you stay informed, supported and - most importantly - covered during these market conditions.
- Start the renewal process early: In a hard market, you can’t wait until the last minute to secure quality cover. Be sure to engage in your PI policy renewal process as early as possible. Doing so will give you plenty of time to gather any documentation required for renewal. In addition, insurers will likely ask more questions than usual before finalising your policy, making it even more vital to get a head start on the process.
- Invest in risk management: Now more than ever, it’s vital to invest in robust risk management processes and provide documentation of these practices to your insurer at renewal time. Your risk management documentation should highlight:
- Proper cash flow processes
- Seamless contracts with clients that clearly outline the responsibilities of both parties
- Effective supply chain management (e.g. positive relationships with suppliers, due diligence of supply chain risks and well-distributed liability agreements)
- Robust internal practices and standards to mitigate onsite risks
Professional indemnity cover offers protection against losses that result from legal action due to a negligent act, error or omission by your organisation. This form of insurance can also cover concerns such as slander, libel and breach of contract. PI cover is especially critical for organisations that provide professional advice, offer educated recommendations, design solutions or represent the needs of others.
If you’d like to speak to us, simply give us a call or request a call back, and one of our specialists will call you in the coming days to follow up and see how we can specifically help you.