Indeminity Insurance Cover

[messy]

What sort of cover should one aim for when setting up professional indemnity insurance cover for compiling FRAs and Training?

£1m, £5m? £50m? - I have no idea, so pleasegive me a clue at what level I should consider. W
hat do you suggest - indeed if it's not too much of a personal question, what is your PI cover?

[Chris Houston]

My personal opinion and the real world differ.

Personally I think you should have the level of cover to pay for the damage if you get things wrong.  So if you assess 50 million pound buildings with hundreds of occupants, you should have enough cover to pay out to all their families and the building owners if it all goes wrong.

Cost probably prevents you from buying that much cover and I think most people buy only what they clients demand.  When I worked for an insurer, we would ask our clients to make sure their contractors had 5 million of cover.  Many previously didn't.

On the plus side, unless you are moderatly rich, there is not much chance of you being sued personally as it is too much hard work to sue someone who has not much to take.

So 50 probably costs too much, 5 is probably what most large consultants will buy.

[Thomas Brookes]

From memory I think bodies such as the ECA Electrical Contractors Association will only accept you if you have £5m public Liability insurance, most bodies are now asking for 10million employee liability insurance and £5m Indeminity and efficacy (failier to operate) insurance.

How ever I tend to agree with Chris, unless you are quite happy to risk everything you own try to get enough insurance to cover the cost of the buildings you are working in.

In my experience most large companies will tell you the minimum level they will accept before you can work for them.

[kurnal]

In terms of Professional Indemnity Insurance, this is a very significant and ongoing cost for the smaller practice, much more expensive than the statutory Public Liability and Employers liability Insurances.

Its as Thomas says, many large organisations will set a minimum level, often plucked out of the air and unrealistic. When challenged they will often accept a lower figure.

Whilst a small practice can easily obtain PI  cover of £2 million, for any job requiring more than that most Insurers will only consider offering cover on a case by case basis. This can be prohibitively expensive, especially as the premium is ongoing and cover lapses when you stop paying the premium.  Rather than go down that path you could set out the  level cover you feel able to offer the client and give them a copy of the insurance certificate  with the contract for the avoidance of doubt.

If you are a member of a trade association they may be able to help find cost effective insurance.

[Mushy]

Has anyone any experience of stopping FRA's and going on to other employment with regard to also stopping the PLI and PI

I've been advised by my insurance company to carry on paying contributions just in case I get sued at a later date

[jokar]

I think you have to keep paying for ten years after you finish because of the liability issues.

[kurnal]

I guess if you recommend a review date in your fire risk assessment then thats a reasonable cut off date for  insurance in respect of that risk assessment? If you have been involved in fire design strategies or engineered solutions then 10 years would be the absolute minimum.

[Morri]

When I packed in my wee safety consultancy a few years back I don't recall there being an issue regarding ongoing PI insurance.

I'd have thought the insurance was valid for work you undertook whilst the cover was in place. You can bet that the insurers wouldn't pay out on work you undertook prior to them taking you on.

[Mushy]

My insurers have emailed me again saying that I should keep it at least til it expires in September...they termed it 'run off' payments....mine is almost £38 a month...but obviously its up to me

sorry for going off thread but I have another issue about continuing payments...

I have Yell.com which is internet based and not yellow pages to which I have to carry on paying my monthly subs for another 200 quid...ok fair dues if it was the yellow pages book....but they could easily take my ad off the internet and scrap my subs...oh well onwards and upwards hey

[Wiz]

My insurers have emailed me again saying that I should keep it at least til it expires in September...they termed it 'run off' payments....mine is almost £38 a month...but obviously its up to me

I agree with Morri. Your insurance should cover you for the period that you provided the service. Once you discontinued providing that service, you no longer required the insurance cover. Your insurers will obviously try to get you to pay for as long as they can. It is in their own interest. Keep your insurance policy documents for 20 years. If someone tries to claim in the future, direct them to your insurance company. This is not to say they  insurance company still wouldn't try to wiggle out of responsibility - it's in their nature!

sorry for going off thread but I have another issue about continuing payments...

I have Yell.com which is internet based and not yellow pages to which I have to carry on paying my monthly subs for another 200 quid...ok fair dues if it was the yellow pages book....but they could easily take my ad off the internet and scrap my subs...oh well onwards and upwards hey

Unless you have signed a contract stating how long you will pay these fees, then just stop paying the fees. A court will side with you unless there is an unambiguous contract in place with Yell.com confirming that you had agreed to pay.

Fortune favours the brave. Just stop paying. Big business is happy to try and bluff you, but mostly can't be bothered to sue you unless they have a cast-iron case!

[Mushy]

Thanks Wiz I was thinking of doing just that...I can't remember any signed contract...I'll request to see it...just worried that I might be put on a 'bad credit risk' list

[Wiz]

Only registers of credit risk reports worth worrying about are Experian and Equifax. You can check your own reports with them both for a small fee. Both allow you to amend any incorrect entries.

[kurnal]

Almost invariably, PII policies are different from other types of liability insurance. PI policies are usually written on a "claims made" basis, which means that the insurance will provide cover for claims first made or circumstances arising and notified to the insurers during the term of the current policy, irrespective of when the activity giving rise to the claim occurred.

It is therefore important that, assuming that the policy is written on this basis, the policy remains in force for an appropriate period to provide protection against any claims which may arise in the future for work done in the past.

[Mushy]

What would happen then if a Fire Authority were satisfied with your Fire Risk Assessment when they went to check it?...surely that would weaken any case against you

[kurnal]

Definitely. Personally I dont have too many worries about liabilities for fire risk assessments,  because its potentially only a snapshot of the day you visit unless you make some fundamental error.
However building design fire strategies and engineered solutions are a different matter.