How Does Professional Indemnity Insurance Work? Claims Process

PI insurance protects you when a client claims financial loss from your professional negligence. Understanding the process helps you maximize cover.

How It Works

If a client claims financial loss due to your professional error, your insurer covers defense costs and compensation (up to policy limit).

Claims-Made Basis

Most UK PI insurance is claims-made, meaning the policy when claim is notified provides cover, not when error occurred.

The Claims Process

Step 1: Early Warning. Step 2: Assessment. Step 3: Solicitor Appointed. Step 4: Investigation. Step 5: Negotiation. Step 6: Settlement.

What's Covered

Legal fees, investigation costs, court fees, damages, and interest on awards.

"Notify your insurer immediately. Late notification can void cover."

— Association of Professional Indemnity Insurers

Frequently Asked Questions