MGB can offer a number of options for brokers’ own PI. We are able to approach multiple markets to get a competitive price for a policy which fits your requirements.
MGB BIBA Accreditation
We are a BIBA-accredited broker for BIBA members’ PI. Apart from our open market options, MGB can offer an extremely wide wording developed in association with BIBA, underwritten by Manchester Underwriting Management and insured by CGPA Europe.
This is a premium product which provides support in avoiding problems in the first place and unbelievably good cover if things go wrong. It’s more than just insurance, though. It’s a business support service too.
The package contains features unique to the existing market. So, for once premium alone can’t be the sole differentiator.
The Manchester Underwriting Management product is recommended by BIBA and the key features include:
- No contracting out of the Insurance Act 2015
- No basis clause
- No warranties
- No conditions precedent (not even claim notification)
- Very broad protection against innocent non-disclosure
- Late notification protection
- 7 days after expiry to notify claims
- Civil liability cover including defamation, dishonesty, loss of client money and joint ventures
- Costs in addition to the limit
- Regulatory investigation costs
- Compensation for court attendance
- Automatic binding authority cover
- Data Protection defence costs cover
- Hacker cover
- Loss of client cover – if your business makes a loss in its P&L because of your losing a client following the payment of a PI claim, MUM will indemnify you up to £25,000 for that loss (exclusive to BIBA members)
- Fidelity automatically covered (exclusive to BIBA members)
- Totally fair treatment not only promised but written into the wording
Manchester Underwriting Management has partnered with CGPA Europe (link to CGPA Europe website). CGPA have specialised in writing almost nothing but insurance intermediaries’ PI for over 85 years and are rated A- by Standard & Poor’s. Formed in France as a mutual by brokers and agents for brokers and agents, CGPA is now offering its unrivalled support to the intermediary market in the UK through its subsidiary, CGPA Europe. CGPA’s board even consists of a number of brokers and agents.
Legal Support and Claims
With our BIBA-accredited wording placed with Manchester Underwriting Management and CGPA, there is a unique free legal support service providing an early claims prevention advice service which will operate if an insurer has reserved its rights of declined cover for one of your client’s claims. The service is provided by Mills & Reeve LLP. Simply contact them by email or telephone and they will provide assistance to help you to assess whether the insurer’s decision can be legitimately challenged and, if it can, to provide guidance about the approach you may legitimately take to protect your client’s position.
We can also provide legal support with Fenchurch Law Limited for those brokers who do not purchase our BIBA accredited product.
What can go wrong?
Against a background of increasing regulation and compliance, the competitive nature of the UK insurance market and high client expectations, it’s no wonder mistakes are made. Most of them don’t matter and are easily rectified, but unfortunately some do: and they can have a real impact on relationships with clients and insurers and cause long-term damage to professional reputations. Moreover, insurers’ margins are under more pressure than ever before with the market so competitive, meaning that broker error is often a reason given not to indemnify.
Things like:
- Failure to arrange or renew appropriate insurances
- Failure to explain the implications of exclusions and warranties
- Failure to communicate insurer requirements (e.g. risk management improvements)
- Failure to disclose material information to insurers
Most brokers have been forced to change insurer once or twice in the last few years as insurers entered the market aggressively and have now pulled back or exited after unsuccessful topline underwriting. That is why proper, sensibly priced cover, secured by an insurer that has commitment to the Brokers’ PI market is essential. MGB have the experience to help you achieve this.
Fortunately, insurance brokers know better than most how important the right insurance protection is.
Cover considerations
The Financial Conduct Authority requires insurance brokers to hold professional indemnity insurance, stipulating minimum cover requirements. In practice, many brokers will require limits well in excess of these minimums.
Insurance broker policies are usually written on a full civil liability wording tailored to reflect the specific exposures of that business.
What are insurers looking for?
Insurers want to know about the range of insurances offered, highest and average sums insured, any specialisms and the qualifications and experience of individuals advising clients. Scheme arrangements will need to be disclosed especially where there is authority to bind or renew policies in-house.
Insurers want to see evidence of good risk management, particularly in terms of staff supervision, consistent written records of client interactions, diary procedures and leadership in regulatory and compliance issues – as evidenced by a good claims experience.
Any in-house financial services exposure (past or present) will require completion of a Financial Services Questionnaire.