Worldwide professional indemnity insurance

IronWolf

I didn't know whether this was better here or the insurance board, but I have been having a hard time finding professional indemnity insurance that covers me worldwide for a new business venture I'm planning.

I have so far found 1 broker that can handle it, and they have only 1 insurer on their books they think will cover me. But I don't want to get ripped off so would like some other quotes.

Its also difficult because my potential exposure could be into the millions.

Does anyone have worldwide PI insurance, and which broker do you use?

Thanks

InsideInsurance

Try https://www.occommercial.co.uk and speak to Katy Powell if she is still there.

Being an advisor to insurance companies I have the devils own job getting competitive PI as ultimately they dont want to insure me if its them I am giving advice to as they'd effectively then be suing themselves if they want to claim against me and if I am working with one of their competitors then they almost do want me to give them bad advice.

In the end I didnt buy via them as I went out for drinks with the lead underwriter of a former employer who gave me an exceptional price as repayment for services rendered but I was very impressed by her and she did get very close - I pay £500 for PI/PL/EL (£1m PI), her quote was £550 and my next best quote ever from a policy that didnt have massive holes in it has been about £2k.

trailingspouse

What do you do?

As far as I know, Hiscox are the go-to insurers for this sort of risk - but that could just be in the line of business we're in.

IronWolf

InsideInsurance wrote: »

Try https://www.occommercial.co.uk and speak to Katy Powell if she is still there.

Being an advisor to insurance companies I have the devils own job getting competitive PI as ultimately they dont want to insure me if its them I am giving advice to as they'd effectively then be suing themselves if they want to claim against me and if I am working with one of their competitors then they almost do want me to give them bad advice.

In the end I didnt buy via them as I went out for drinks with the lead underwriter of a former employer who gave me an exceptional price as repayment for services rendered but I was very impressed by her and she did get very close - I pay £500 for PI/PL/EL (£1m PI), her quote was £550 and my next best quote ever from a policy that didnt have massive holes in it has been about £2k.

Thanks. £2k seems pretty steep, but I guess for the level of cover I need it wont come cheap.

I will be selling data on stocks and shares which people will be using to make investments. It wont be 'advice' and I'll be pretty clear on that so I shouldn't be open to lawsuits, but of course I'm no lawyer and may accidentally leave a hole for someone to attack me.

I've thought about it a bit more and am thinking I may instead have to incorporate and then get some basic errors and omissions insurance for the company. I don't think its worth risking ruining my entire life to save a few quid in costs saved by being sole trader vs ltd co.

dacouch

Have you drawn up t&cs for your customers, if so do they limit your liability and have you supplied them to the broker?

Which broker have you gone to?

paddyrg

Ltd co the whole way. If you're doing anything where there's a chance of some chancer threatening to sue, even if they plan to settle for less than the cost of defending, better not to risk your home!

Alas the world is full of chancers. This forum is a bit of a magnet for them too, if you read some of the threads about compo claims!

Sounds like your first port though is a decent lawyer to write up strong terms of business which you make every punter read and sign. Then maybe whatever the FSA is now called to make sure you don't accidentally start stepping into their world.

Mistral001

I would not assume that going Ltd is a "get out of jail" card as far as getting sued is concerned. Also PI Insurers ask a lot of questions about the directors of Ltd companies and will take into account past history of claims for those directors. Most firms such as solicitors, consulting engineers, surveyors etc. are not Ltd and it is not through lack of seeking the best legal advice that they decide to operate that way.

IronWolf

Ive drafted extensive terms and conditions that they are forced to view and agree to before checkout, these say i am only giving info and not advice and am not liable for anything pretty much. I drafted them based on a few other companies terms which provide the same sort of thing so should have everything covered.

Interesting that a ltd co might not protect me personally, i though that was one of the points of them. My personsl history shouldnt be a problem ive got no claims against me and no bankruptcy etc

Paddy thats exactly what i was thinking, in theory its pretty easy to protect yourself legally, plenty of public websites like FT give out this sort of information and a basic terms page somewhere on the site covers them. But theres always the chancers that could go for a weak target in the hope of a settlement even if the case has no merit.

InsideInsurance

Hopefully your solicitor is going to be reviewing the terms to ensure they are as water tight as you hope particularly give the world wide nature you want your site to be.

The other major issue is that T&Cs are fine, having a limited company is fine but none of that stops people litigating against you. Even if they have no realistic prospects of success there is still a significant cost involved in defending a claim, particularly if its being brought against you in a different country (eg the USA). PI insurance comes into its own not just because it pays out for any successful claims against you but also because it defends all those that ultimately prove to be unsuccessful.

The point of a Ltd company is to protect its shareholders not its directors. In recent years there has been an increase in people pursuing directors rather than the companies, presumably because of the theory that people could hide behind the Ltd and just fold it if things go a bit wrong.

I am not certain if you are treating this as a true business or if its a bit of a hobby thing that if it takes off it'll become a business. If it is a business then PI is the route to go and possibly also D&O. If its the later then maybe just D&O but this would be a higher risk strategy and inevitably could leave any company profits wiped out but just you protected

IronWolf

InsideInsurance wrote: »

Hopefully your solicitor is going to be reviewing the terms to ensure they are as water tight as you hope particularly give the world wide nature you want your site to be.

The other major issue is that T&Cs are fine, having a limited company is fine but none of that stops people litigating against you. Even if they have no realistic prospects of success there is still a significant cost involved in defending a claim, particularly if its being brought against you in a different country (eg the USA). PI insurance comes into its own not just because it pays out for any successful claims against you but also because it defends all those that ultimately prove to be unsuccessful.

The point of a Ltd company is to protect its shareholders not its directors. In recent years there has been an increase in people pursuing directors rather than the companies, presumably because of the theory that people could hide behind the Ltd and just fold it if things go a bit wrong.

I am not certain if you are treating this as a true business or if its a bit of a hobby thing that if it takes off it'll become a business. If it is a business then PI is the route to go and possibly also D&O. If its the later then maybe just D&O but this would be a higher risk strategy and inevitably could leave any company profits wiped out but just you protected

Thanks for the advice, I'm still thinking about D&O and whether its worth it. Seems like the PI is still necessary though. Hopefully if its all in a ltd co the insurance companies will be more relaxed covering me.

InsideInsurance

IronWolf wrote: »

Thanks for the advice, I'm still thinking about D&O and whether its worth it. Seems like the PI is still necessary though. Hopefully if its all in a ltd co the insurance companies will be more relaxed covering me.

vSME ltds tend to make insurers more worried because the perceived break in responsibility that it creates in the mind of small operators. When you're house is at risk you tend to be more careful than when its just the £50 in the company's bank account at risk.

My quote of £2k is for all three classes of insurance with an international element on all three. PL will take a big hit when you need some element of US cover due to their punitive damages. Similarly I am actually giving advice and I cannot realistically substantially limit my liability to my clients. My current piece of work has a £11m budget and £250m benefits so if it went badly wrong there is an argument for a rather big bill to come my way.

Speak to a decent advisory commercial broker and they will get you quotes. The one I linked to got the price down to £550 but needed copies of my CV, qualifications, references etc to validate that I am actually qualified to do what I do and not just very good at interviewing