Why is it becoming harder to secure PI cover as a business?

Why is it becoming harder to secure PI cover as a business?

It is becoming increasingly difficult to secure adequate PI cover due to hardening markets.

What has changed and how does the hardening market affects PI cover?

A hard insurance market is where there is a high demand for cover but a lower supply. The UK insurance market has hardened in recent years due to various large-scale disasters in the UK.

Grenfell tower and the collapse of Carillion are just a couple of high profile examples. Add in some natural disasters, unexpected insolvencies and broken supply chains, and we have a significant rise in PI claims.

This has meant that several insurers have stopped offering Professional Indemnity with no new insurers popping up in their place.

This leaves the remaining insurers to try to insure EVERYONE. As a result, these insurers that have remained in the PI market have had to take measures to limit their exposures.

What are these measures?


Extra information will now be required at renewal.

You are now more likely to be asked questions about

  • Your business operations
  • Supply chain processes
  • Current Risk Management procedures

Higher Premiums

Premiums have increased to compensate for lost profits from too many claims.

Restrictions on cover

This includes eliminating various policy extensions (such as cyber-liability cover)

So how can YOU secure adequate PI cover?


Speak to your broker

Make sure you communicate what your business needs to your broker. After all, your broker has the insurance expertise to provide you with the right cover at the right price.

Keeping your broker up to date can help you stay informed, supported and adequately covered.

Start the renewal process early

In a hard market, you can’t wait until the last minute to sort out your cover. Be sure to start the renewal process as early as possible.

This will give you plenty of time to gather any documentation required as well as answer any of the insurers questions before you renew.

Invest in risk management

It’s often necessary to provide documentation for your insurer that details your robust risk management processes. Your risk management documentation should include:

  • Proper cash flow processes
  • Seamless contracts with clients that clearly outline the responsibilities of both parties
  • Effective supply chain management. For instance, positive relationships with suppliers, due diligence of supply chain risks and well-distributed liability agreements.
  • Robust internal practices and standards to mitigate on-site risks.

To find out more about PI insurance, speak to your broker. Our team are available Monday to Friday to answer your questions and set you up with the right cover.