Consultation Paper on Professional Indemnity Insurance for Insurance Intermediaries and Insurance Managers
Results updated 10 Jun 2022
A feedback statement on the consultation can be found at the link below. Alongside the feedback statement the Commission has issued final drafts of the relevant amended Rules wording, taking into account comments received during the consultation. A final eight-week consultation period is being offered to provide an opportunity to identify any “fatal flaws” in the draft amended Rules, after which amendments will be formally adopted. Comments may be submitted via the Commission's Consultation Hub (link here) where copies of the draft Rules can also be found.
Links:
Overview
The Commission has been made aware by industry of an increasingly challenging Professional Indemnity Insurance (“PII”) market. Firms have found the availability of insurance reducing while prices are rising. The Commission has engaged with industry and other stakeholders through questionnaires and interviews. As a result of that engagement, the Commission is publishing this Consultation Paper to seek industry’s views on proposed changes to the rules around the maintenance of PII.
The Commission has engaged with the insurance sector and also the fiduciary and investment sectors. The issues surrounding price and availability are relevant for all sectors, but various factors differentiate the insurance industry from fiduciary and investment businesses. These factors include the exposure to retail customers; the location of customers; the nature of advice given within each sector; the average size of the firms; and each industry’s claims experience. The Commission is therefore carrying out a separate consultation for the insurance sector. Where appropriate the Commission has adopted consistent approaches across all industry sectors. A separate Consultation Paper making proposals in respect of PII for the fiduciary and investment sectors has also been published and is available on the Consultation Hub.
Summary of Proposals
The Consultation Paper proposes to loosen requirements where possible but also to ensure that the rules for PII are up to date and fit for purpose.
The Consulation Paper, which includes detailed proposals, can be found below.
The Commission would like to thank the licensees which participated in the surveys and interviews for their cooperation.
What happens next
Responses to this Consultation Paper will be considered by the Commission prior to issuing any new rules. A Feedback Paper will also be published, summarising the responses to the Consultation.
Audiences
- Insurance Managers
- Insurance Intermediaries
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