Professional Indemnity FAQ

Mediation - a way to settle Professional Indemnity claims

Mediation - a way to settle PI claims

It may surprise you to know that 99% of Professional Indemnity Claims never make it to Court and that really is a good thing.

I myself have never had any claims go to Court but they have been very close. It adds a huge cost to the value of a claim and this can be avoided by use of experienced solicitors skill (which is why insurers pick very good solicitors to handle claims).

Or instead it can lead to the use of an independent, impartial, and respected third party (called the conciliator or mediator) to help in settlement of a dispute. This is a quicker, less humilating and above all cheaper way of resoving the matter, instead of opting for arbitration or litigation.

Unlike an arbitrator, a mediator has no legal power to force acceptance of his or her decision but relies on persuasion to reach an agreement. Also called conciliation. Good experienced mediators are highly valued due to their skill to Chair a meeting and diplomatically bring about a compromise to each party.

Another way claims costs are kept down and therefore premiums.

Latest News

D&O premium pool ‘must treble’ to return to profitability

A new report – called "Show Me The Money!" by insurer XL Catlin and law firm Wotton + Kearney – is the second in a series of three white papers on securities class actions and their impact on the Directors & Officers Liability (D&O) market. The main conclusion is that Directors’ and officers’ (D&O) insurance premiums are under-priced significantly and need to rise strongly to restore profitability. The main risk areas are those exposed to securities class actions, 

It says Directors & Officer's Side A, Side B and Side C cover has been chronically underpriced since at least 2011, while the frequency of class actions is increasing as more plaintiff lawyers and litigation funders enter the space.

The analysis suggests last year’s overall premium pool of about $210 million would need to increase by at least three times to establish a profitable market, if it is assumed all other factors stay unchanged.

“Recent market developments would indicate most D&O insurers are now endeavouring to restore some semblance of profitability to their portfolios after years of market losses,” the report says.

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75% of Cyclone Debbie claims settled

In the 6 months since Cyclone Debbie devastated Queensland and parts of northern New South Wales:

• more than 31,000 homes and business have been repaired or received settlements from their insurance company

• more than 20,000 families have had possessions replaced

• more than 4,500 motor vehicles have been repaired or new vehicles provided

• hundreds of local builders and trades have been working on properties to repair the damage and destruction caused by the cyclone

• over $5 million has been paid EACH DAY to assist local communities, residents and businesses.

read more