Professional Indemnity FAQ

Floods could bring Professional Indemnity Claims

Floods could bring Professional Indemnity Claims against Brokers

How can floods bring Professional Indemnity claims? Perhaps we should start with Insurance Professionals such as Brokers who are likely to be lined up by some Insureds affected by the recent floods here in Queensland. In what way? We cannot always get flood insurance for our clients. However, we must be seen to have discussed this risk with the client. We must have this documented. We need to suggest to them they manage the risk either with a transfer if possible to an insurer, or to reduce the chance by relocating or having a catastrophe plan in place. If we fail to do this, we will be accused of breaching our professional duty by omitting to provide this advice.

If an Insured makes such an allegation, your defence includes file notes of these discussions, copies of correspondence confirming the Insured's wishes or instructions, demonstrated requests for flood insurance with insurers (where it has been requested but cannot be provided). The old CYA or CYB principal applies.
On top of this, when a client rings wanting to make a claim for flood but you have not arranged such cover, do not tell them they do not have the cover. You can tell them that they did not have specific flood cover but submit a claim anyway and have the insurer go to the effort to make the decision. The insurer has to demonstrate why the claim is not covered. It is not an Insurance Brokers job to do this. It could be that a Storm caused the flood, water may have come back up through pipes causing damage, it could be due to overflow of gutters due to heavy rain. You do not know until the claim is investigated. Deal with the decline as a Broker on the basis you must prove your loss.

Flood is often defined as inundation of normally dry land by water from any natural water course or water way. So an Insurer must prove that was the case if Flood is an exclusion.

On top of this, many ISR policies by simply not even mentioning flood automatically provides it.

Desperate people take desperate measures to blame professionals when they see a chance. It is most upsetting for a professional who has dealt with a client in absolute good faith and having a fantastic business relationship with them, suddenly level accusations against you but with good documentation, a demonstrated effort to deal with their risks and involvement of insurers in the claim, you have given yourself the best chance.

Other Flood related Professional Indemnity Claims

Previously I mentioned about the risk to us Insurance Brokers from our clients uninsured from the recent flooding here in Queensland. No doubt there will be many investigations into the damage caused to lots of property and many other Professionals could be called to account. Examples include:

  • Real Estate Agents failing to inform purchasers that the area has been know to flood.
  • Solicitors and Conveyancers - failing to act on the instructions regarding approriate flood searches for the area
  • Engineers - were supposed to design certain infrastructure to cope with certain levels of flooding
  • Councils - for approving property development into potential flood regions
  • Property developers - for developing in areas known to flood and not dealing with the potential with appropriate infrastructure.
  • Architects - not designing buildings to cope with flood events

These are just some examples. Human beings are not all that forgiving and if the opportunity arises to be compensated where they are unable to by other means like their own insurance policy, they may look for other ways. We are living in an increasingly litigious society.

 

 

Latest News

Robert Cooper - one of 100 faces of small business

This week it was announced as part of Small Business Week,  that Robert has been named one of the 100 faces of small business for a State Government promotion on the great value that small businesses play in the State of Queensland.

You can see Robert's entry here:

It is the third accolade for CPR Insurance Services in a month and after seven and a half years in business is a real pep up for the company.

For Robert, it is the culmination of many years experience, becoming well qualified, experiencing the highs and lows of a career and always wanting to contribute to his community. Sometimes, these things just come together and you receive recognition for your efforts.

Robert says that there is no doubt that starting your own business is a huge challenge, but with the right research and planning, the right people around you and a good set of values that you apply to the vision of the company, you have a very good chance of making it all succeed.

Robert says he is lucky. He has a strong supportive Wife, Mandy, who is also part of the business, along with efficient and hard working staff such as Julia McLauchlan and Aidan Harmer who are building up their own skills in a learning environment. 

However, the most important and most supportive people for CPR Insurance Services are our clients who have stuck by us and supported us over the past seven years. Our focus remains on providing the best possible service we can and always acting in their best interests. To all our clients, we say thank you!

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CPR Insurance wins Brokerage of the year

CPR Insurance Services picked up the award for the Best Brokerage (1-5 staff) in Australia, last Friday Night (4th May 2018) at the Insurance Business Magazine Awards held at the Westin in Sydney.

Judging came from various parts of the industry. It is a great honour to be recognised for our hard work and particular Business values we follow. A full list of winners is listed here.

Success comes from having great staff, and we thank Aidan Harmer and Julia McLauchlan as important support staff for helping us win such an award.

CPR Insurance has been in operation for more than 7 years now and is only successful because of the wonderful support from our staff, insurers and most importantly, our fantastic clients who put their faith and trust into our company to be their Risk Advisers and Brokers. 

Thank you to all.

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