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Keith Churchouse: Taking the pain out of PI

It is that time of the year when we face the professional indemnity insurance renewal. The experience is not one I enjoy and I tend to keep it on my to-do list.

What a bore it is when the weighty cover letter, requirements and application/confirmation forms land on my desk. It usually arrives three months before the renewal date, complete with a multitude of insurance wording caveats about declaring your full details.

You could argue this slightly apathetic approach is the reason why so many of us renew rather than shop around. But because of this notion, I have completed the form and returned it to our provider in good time, as requested.

I have also taken the opportunity to send the same details to two other PI providers to compare what premium and quality of cover they provide.

With average PI premiums potentially rising, this comparison is ever more important, especially with the rising cost of the other PI cover to which we contribute, namely the Financial Services Compensation Scheme.

In the past, I have experienced a PI insurer not providing its terms until a few days before the renewal date, having received our renewal details weeks beforehand. This was either a strategy or in the hope we had not sought alternatives. Lucky for us, we had.

The subsequent PI responses make interesting reading and build confidence that, in making your cover selection, you have done the best for your business on a cost-control basis, while maintaining quality of cover.

We also checked the cover offered would meet the standard required after the RDR to allow us to remain independent.

The provider sales calls accompanying the PI quotes can be telling in the reason why our cover is more expensive is the quality and depth of cover we provide. This approach focuses on the buying process the decision-maker and cheque writer is going through.

This is a similar type of buying experience our clients and enquirers experience when they look for protection cover, whether it is life, private medical or IHT-based.

Clients understand the need for the insurance but the thought of divulging their details and possibly having to go for a medical puts apathy in the path of progression. This is a barrier we handle with care, guiding them to a successful conclusion, either as a single requirement or as part of an holistic financial plan.

It is your service that makes the experience bearable for your clients as they go through the process. I just wish the PI insurers and brokers would take a leaf out of our book and be more helpful. I do not remember any positive buying experience relying solely on caveat emptor as its main approach.

Keith Churchouse is director of Chapters Financial Limited

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