Professional indemnity insurance common proposal form
Professional Indemnity Insurance, Registrar of Solicitors
The professional indemnity insurance (PII) common proposal form for the 2014/2015 indemnity period will be available to download in early September from the Law Society’s website at www.lawsociety.ie/PII, under the 2014/2015 renewal resources section. The form will also be circulated by insurers, directly or through brokers. The form has been slightly amended for the 2014/2015 indemnity period to make the form clearer and easier to use.
This common proposal form ensures that each firm will have to complete only one proposal form at the next renewal, thereby simplifying the renewal process for the profession and making it easier for firms to obtain multiple quotes.
The Law Society’s PII helpline is available Monday to Friday, 10am to 4pm, to assist firms with PII queries: 01 879 8707 or email@example.com.
Points to note
- Ultimately, the principals/partners of each firm are responsible for obtaining PII for the firm before the renewal date.
- The proposal form should be submitted early, be completed fully and correctly, have all required documentation attached, and be clear, accurate, well-presented and comprehensive. Try to avoid submitting handwritten proposal forms.
- Firms are not required to provide certificates of good standing with the common proposal form, and insurers did not seek to have a requirement to provide this certificate included in the common proposal form. Please note that the fee for obtaining a certificate of good standing from the Society within ten working days is €100, to be paid in advance of the certificate issuing. Certificates of good standing issued later than ten working days are free of charge.
- Answer all questions – if you are unsure of any question, answer what you think the insurer is looking for and provide additional information to clarify. Check and recheck the form to ensure that all questions have been answered correctly.
- Check that all additional documentation has been attached to the form and is correctly cross-referenced.
- Make sure that the figures add up. For example, ensure that gross fee income figures add up to 100%.
- The insurer must accept a fully completed proposal form as a duly completed application for a policy and must not require the firm to complete or submit any other proposal form or application for a policy.
- An insurer cannot require a firm seeking a policy to provide it with supplemental information until such time as the insurer has received and reviewed a proposal form fully completed by that firm.
- The insurer can only request a firm to provide it with supplemental information where the insurer reasonably requires such information in order to decide whether to insure the firm. In this case, the insurer must make a statement to that effect and request that the firm provide such supplemental information within a reasonable timescale.
- It is proper practice for firms to notify insurers of claims or circumstances arising during the year as they arise, not at the end of the indemnity period. Notifying all claims and circumstances at the end of the indemnity period is referred to as ‘laundry listing’ by insurers and is not looked on favourably.
- Firms must notify their current insurer of all claims and circumstances before the end of the indemnity period.
- The common proposal form is an application for normal PII, not for run-off cover. Firms should contact the special purpose fund manager, Capita Commercial Insurance Services, with regard to obtaining run-off cover through the Run-off Fund. The special purpose fund manager can be contacted at tel: 0044 207 397 4539, email: firstname.lastname@example.org. More information on the Run-off Fund can be found on the Society’s website at www.lawsociety.ie/Run-off.
- Claims information must be provided by your current insurer and be attached to the common proposal form. If you have a poor claims history, provide the insurer with further information on how the claim arose and what procedures are now in place to ensure that, henceforth, as far as possible, such claims will not arise. Failure to provide a claims history or provision of an incomplete claims history may indicate to insurers that something is being hidden. Claims information is used by insurers to compare your previous loss experience against improvements to risk management you may have implemented or changes you may have made to your work type activities.
- Firms should ensure to redact any information in any documentation provided to insurers that may breach legal privilege or client confidentiality.
- Insurers focus on risk management, and it would be to the benefit of firms to demonstrate to insurers that they have robust risk-management procedures in place.
- Ensure that the form is signed and dated, otherwise the proposal form is invalid.
- With regard to Yes/No questions in the form, where the answer is some variation of yes or no, expanded answers should be provided on such questions in the covering letter submitted with the form.
John Elliot, Registrar of Solicitors and Director of Regulation