If you are to have a claim (we hope you never do!), it's imperative that it is dealt with promptly and effectively by your insurer. Here is a list of top 10 tips when notifying a claim.
- Professional Indemnity insurance (PII) is written on a claims made basis. This means that the policy will be triggered for claims or circumstances made during the policy period regardless of when the (alleged) wrongful act occurred. This makes “when to notify” claims incredibly important.
- Be very aware of the expiry date of your policy, claims received or circumstances of which you have become aware before expiry of the policy must be notified to your insurers immediately and before expiry.
- A claim is when your firm has received a demand or intimation to seek for civil damages. A circumstance is a defined term within the policy wording, it relates to any act, error or omission that may, objectively speaking, give rise to a claim under the PII policy (this could even be an error that you have found through internal audits and your client is not yet aware of).
- When you first become aware of a claim or circumstance, you must look to notify this to the claims notification address. This will be provided within the policy wording or attaching policy documents. It could be that you are to notify your broker, or the insurer direct or even solicitors acting for your insurer.
- If you are in any doubt as to whether or not or when to notify a claim or circumstance that may give rise to a claim against the insured, insured firm or policyholder, err on the side of caution and make the notification as soon as possible.
- Do not make any admission of liability without the consent of the insurer(s).
- Do not settle or make any promises of payment (including any offers to repay or reduce your fees) without the consent of the insurer(s).
- Whenever possible, do not disclose to the claimant/ complainant that you have made, or are intending to make, a claim under your PII policy - until such time as insurers give you consent to do so.
- Do not take any action that may prejudice your insurer’s position or their ability to investigate the claim (or circumstances that may give rise to a claim) against the insured, insured firm or policyholder.
- Where you are requested to release a copy of your client file to your client or their solicitors, ensure that you have only released the papers which the other party is entitled to receive and retain a complete copy of what you have sent.
