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JL  
#1 Posted : 07 February 2019 09:01:10(UTC)
Rank: Forum user
JL

A question was posed to me the other day about individual or company level Professional indemnity insurance “what are the consequences of going for the cheapest option”, a really good question that I couldn’t accurately answer.

Other than the obvious consequence (not being covered), are there any standards in cheap PI insurance policies have that better brands don’t.

Particular clauses in the T&C’s

Unrealistic burdens of proof or professional standards to achieve in order to qualify

There must be some differences in T&C’s or expectations that your amazingly cheap PI insurer isn’t telling  you.

Brian Hagyard  
#2 Posted : 07 February 2019 09:49:59(UTC)
Rank: Super forum user
Brian Hagyard

Sorry I cannot give you an answer but your post did bring to mind a current TV advert where the insurance company proudly boast they pay 100% of all valid claims!

Gerry Knowles  
#3 Posted : 07 February 2019 10:25:41(UTC)
Rank: Forum user
Gerry Knowles

As with all insurance its not the cost of the premium its the level of service and the burden of proving that you are not at fault following a claim.  So read the terms and conditions cairfully and look for valid recommendations from other people. 

Mr Insurance  
#4 Posted : 07 February 2019 13:01:45(UTC)
Rank: Forum user
Mr Insurance

When you buy insurance, you are buying a promise that in the event that something goes wrong, the insurer will meet this promise and pay your claim.

The question you need to ask is do you trust the company giving the promise? Are they UK regulated or passported in from overseas; do they have a recognised financial rating (S&P etc); are they well established; what is the general feedback about them; Does the policy wording cover what you need it to?

If you are satisfied with all the above, the level of premium is academic - you may be getting a bargain. 

Despite most people thinking insurers are rip-off merchants who bathe in champagne, in reality, most operate very close to break-even and the premiums are set at a level to cover the claims and their costs with very little profit. If somebody can buck the market trend and offer cover at a much lower cost than everyone else, you may need to ask why? The old adage of "if it sounds too good to be true..." is as relevant in insurance as any other business.

Edited by user 07 February 2019 14:07:24(UTC)  | Reason: Spelling

AcornsConsult  
#5 Posted : 07 February 2019 18:34:32(UTC)
Rank: Forum user
AcornsConsult

The only way to find out if the insurance cover is what you wanted, is when a claim is made and is honoured to your expectations.  Its really difficult to imagine the circs under which you may hae to make a claim at the time of making your application.  Inevitably there will be cases which fall outside of the cover.  That could happen if we paid £10 or £5000 for the policy and whether it is a truly historical company or one that opened yesterday.

Using the health and safety phrase, insurance and its certainty to payout is probably the biggest risk to manage that ll the other work tasks put together.

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