Rule 9 - Professional Indemnity Insurance Flashcards
What must a firm have?
Adequate PII to a standard approved by the Regulatory Board.
What does PII cover?
1) Cover to protect the consumer/clients.
2) Resulting from Professional Negligence.
3) The amount of cover is generally based upon turnover, but you must have adequate cover for the work you are carrying out.
4) Cover should include each and every claim.
5) Must have minimum RICS wording.
6) Minimum cover - A) £100,000 or less min £250,000.
b) £100,101 - £200,000 Min £500,000 or £200,001 & Above min £1,000,000.
7) Maximum cover Greater of 2.5% or £10,000.
8) Uninsured excess.
9) Run off cover of at least 6 years. RICS would prefer 15 years.
10) Consumer claims now £1m
11) Cover for past and present employees.
12) Insurers from an RICS approved list of Insurers.
A) What is the recognised PII legal case called?
And
B) What was the case about?
A = Merrett v Babb
B = A surveyor provided advice of a valuation and signed the report by himself rather than on behalf of the company.
What amendments have RICS made to the minimum policy wording?
1) Fire safety exclusions.
2) EWS1 Form which relates to external fire walls.
What is a run off pool?
If firms are unable to obtain run off cover from their insurer or the open market they can apply for coverage to the Run-off Pool.
What are the problems in obtaining PII cover?
1) Less insurers in the market.
2) Economic uncertainty due to Brexit and now COVID 19.
3) Grenfell - Cladding issues in connection with EWS1 Form.
