Proposed changes for professional indemnity insurance (PII) run-off in the UK

5 Summary of the insurers' responses

  1. These responses tended towards caution but welcomed clarification of the requirements on firms. Their views were generally consistent from one responder to another.
  2. Many responses focused on the likelihood of the options to cause some insurers to leave the market due to increased burdens. These were predicted to lead to increased premiums due to reduced competition in the market.
  3. The idea of a staged response (i.e. beginning with one proposed option and moving in time to another) was unanimously not welcomed by insurers.
  4. One consultation response presented a separate proposal based on three principles:

    - incorporate the cost of run-off cover into a firm's normal PII cover while they are trading;
    - make it mandatory that RICS-listed insurers provide run-off cover, in line with the RICS minimum terms; and
    - the run-off policy is jointly underwritten by all RICS-listed insurers.