PII Cover

Question 1

What is the purpose of Professional Indemnity Insurance (PII)?

Answer 1

PII compensates the firm for losses incurred due to a successful claim for negligence.

Question 2

What must a claimant prove to make a successful claim for negligence?

Answer 2

The claimant must prove that the service was not provided as required and that they suffered financial loss as a result.

Question 3

What is negligence in the context of Professional Indemnity Insurance?

Answer 3

Negligence is a breach of duty of care where a Chartered Surveyor fails to provide the reasonable care and skill expected.

Question 4

What is “run-off cover” in Professional Indemnity Insurance?

Answer 4

Run-off cover is insurance that continues to provide protection for claims made after a firm has ceased trading.

As of 1 April 2019, it must be valid for a minimum of 6 years and up to 15 years for consumer claims.

Question 5

What are the minimum indemnity levels and maximum uninsured excess limits for Professional Indemnity Insurance based on turnover?

Answer 5

Turnover less than £100,000: Minimum indemnity £250,000

Turnover £100,001 - £200,000: Minimum indemnity £500,000

Turnover more than £200,001: Minimum indemnity £1,000,000

Maximum uninsured excess:
Up to £500,000 indemnity: Greater of 2.5% of the sum insured or £10,000

Over £500,000 indemnity: 2.5% of the sum insured