The Personal Finance Society has secured a discount of up to 20 per cent on professional indemnity insurance cover for chartered firms.
The deal, agreed through PII broker Howden Windsor, may also extend to additional cover features such as legal liability wording and an extended reporting period.
Speaking to Money Marketing about the deal last week, PFS chief executive Keith Richards said these kind of discounts could be seen as the start of regulatory dividends emerging, where more professional firms are rewarded with lower costs.
Richards said: “Insurers are recognising that increased qualifications of professionalism should lead to lower risk, and they are going to reflect that in premiums.
“You could say this marks the early signs of professional dividends. So although there has been a cost to advisers to achieve higher standards in the run-up to the RDR, it is encouraging to see early signs of recognition.”
Richards added that given the increased professionalism and greater transparency under the RDR, these should in time lead to “less intrusive regulation and, as a direct result, a reduction in regulatory costs”.
Howden Windsor director Neil Pointon says: “We have been working with the PFS for some time to help advisers understand the important considerations they should make when buying PI insurance.
“All too often price is the driver, but the policy wordings vary enormously. Not only have we worked hard to ensure that these policies have the most comprehensive coverage but we have secured a significant discount for chartered firms too.”
In April the PFS and Howden Windsor published a guide to buying PI cover for advisers, which covered areas such as what insurers are looking for, features to be aware of, the importance of notifying insurers of potential claims, and run-off cover.