FAQ's

Let us jump directly to the example.

Say you are a small limited company dealing with sports and health coaching and you have insurance with us with cover level £1,000,000.  At the beginning of the year a visitor walked into your office, tripped on your doorstep and broke their arm at your premises. They say that it’s your fault because it happened on your watch and claim for £50,000 Public Liability for this mishap. Then another client comes and claims that the Coaching he paid for didn’t get him the results promised and in fact has lost him his job.  This is a £100,000 Professional Indemnity claim. This is £150,000 in two claims, not to mention the piles of legal costs and advertising costs to restore your damaged reputation.

Assuming that you notify us straight away of these claims and meet the underwriter’s criteria stated in our policy wording, our policy will indemnify you for the two claims, as well as for the legal and advertising costs that may arise.

All of this means that we will indemnify you for any claim that you become aware of during the term of the insurance and meets the policy criteria up to your chosen cover level.

Most policies today are claims made. Ours is!

A ‘Claims made’ policy is one in which the insurer will consider a claim they are informed of and the claim is first known about during the policy year. The incident that caused the claim could have been years ago - but the key dates are the date on which the claim is first known and advised, and the Retroactive date.

A ‘Claims made’ policy with no retroactive date - or one that is the start date of your business - can be renewed annually and all the time you are insured any claim that arises will be dealt with by the current insurer. When you stop work you then need to have ‘run-off’ period of cover which continues to provide you with cover against a claim that can be made in the future. Clearly, ‘run-off’ cover is not required for a claims arising policy.

A ‘Claims arising’ policy means the insurer in whose policy year the claim actually arose - it could have been years ago - deals with the claim.

Most policies are ‘Claims made’ for the very simple reason that the insurer can "close his books" after the policy year. An insurer issuing a ‘Claims arising’ policy can never close his books.

You do not want to be switching between the two without being fully aware of the consequences. If you move to a ‘Claims arising’ policy from ‘Claims made’ you could almost wind up with the worst of all possible worlds!

The Law and Jurisdiction of the policy is specified as ‘The Law of England and Wales’.  Law and jurisdiction are two different matters. 'Law states what country's laws are to apply to the contract, and the 'Jurisdiction' is which country's courts are to have jurisdiction.  Both are in relation to disputes arising out of the contract between the Insurer and the Policyholder.

What does ‘Territorial Limits’ mean?

The Territorial Limits are the countries and territories where the policy will provide cover to the Policyholder. This is where the policy will accept the serving of formal legal action against the Policyholder.  The insurers will respond to a valid claim from a country or territory within the Territorial Limits of the policy, and the courts of the country from which the claim arises shall have the jurisdiction to hear the dispute arising out of the contract.”

The simple answer is No.

Let us investigate who is actually insured by an insurance policy and who a "complainant" should deal with.

We therefore need to fully understand who provided the service, and who is covered under the terms of the policy.

If both are the same person - then all well and good.

But if the person who provided the service is an individual and the claimant lodges a complaint against them because they alone provided the service, as evidenced by Terms of Business, who was paid, who the contract was with - the fact that they may also be a part of a group that is insured is of no concern or benefit. In such a case the Group did not provide the service, the individual did, and did so outside of the group activity.

It all depends on what you "do" at a "Pamper party". If, at a "Pamper party" what you do is practice one of (or a number of) the disciplines, therapies or business practices we provide cover for and are specified on your policy, then you would be covered and there would be no extra charge.

Each discipline, therapy and business practice has a very simple description – a definition of what it is - so you should read them carefully and be sure what you actually do at your "Pamper party" is what we cover you for.

Before we answer the question directly, let us first establish who is covered and for what.

You could therefore argue that it doesn't really matter where employees or directors actually live or reside.

What really matters, is where business is conducted, and where in particular any business was conducted that gave rise to a valid claim.

The underwriters will ONLY respond to a claim that is brought under UK jurisdiction, against a policy holder that is delivered to a UK address, written in English, meets the criteria for cover (like: the policy holder is actually covered for the business activity that is the subject of the claim) and meets the other criteria.

So, to summarise the answer: Where any employee or director of a company lives has no effect on the term of cover, one must be careful NOT to extend that line of reasoning to mean that the underwriters will consider any claim of any sort from anywhere in the world.

The answer lies in the context of what the "retail store" actually does. Our cover does not include cover for a "retail store". What it does cover is products and services that are sold by you in the course of the business practice that you are covered (by us) for.

It would, in our view, be unreasonable to claim that any business practice we provide cover for has, as an essential element of that business, a retail store. We would see the sale of products that are a part of your practice as more incidental than full-on sales activity of product.

Dependent upon how the store will operate and what it will sell you might be better placed to obtain retail store cover - but it all depends on how the "store" will work.

In the event of a claim that involved the sale of a product (as opposed to the sale of your expertise/service) the underwriter would want to establish that the product sold was as a direct result of, and an extension to, your professional practice and not a stand-alone retail store.

In short, the answer is not a lot in the practical world. They are expressions that effectively means the same thing but tend to be used in different types of business. The insurance they provide covers essentially the same thing - the consequences of a claim that you did something wrong or didn't do what you should have done.

It's perhaps easier to answer the question by asking should an Architect call his cover - Medical Malpractice (clearly no), Errors and Omissions (well maybe - but E&O doesn't include "advice") or clearly Professional Indemnity would be the answer.

For the medical consultant it would actually be medical malpractice.

This is an easy one to get tied up with the words of the title. What's really important is what the cover provides.

In all of the cases used to illustrate this here the answer is - the cover provides for a claim against you for getting some part of your business wrong. Be it an error, omission, incorrect procedure - the claim that you "plain and simple" made a mistake.

First, we need to get to grips with very slightly different words that can mean very different things, and only apply to Professional Indemnity policies.

Claim made: When a claim is made

Claim arising: When the incident that caused the claim occurred - it could be years ago

With Motor insurance for example, when there is a claim there is no great time gap between the "accident" that gives rise to the claim and when the claim is made. A claim is made immediately following an "accident".

Professional Indemnity can be quite different. The claim can arise years after the incident that causes the claim.

So, by way of example, if your policy year was 1st January - 31st December 2018 - then if between 1st January 2018 and 31st December 2018 you first became aware of a claim (and it related to an incident say 3 years ago) and advised the insurer then the insurer will deal with that claim, even though the incident that caused the claim happened years ago.

If you have a break in your insurance coverage (ie a few month gap between policies) then when you renew your policy, you have the option to retain the original Retroactive Date of Nil (incidents any time in the past covered) or change it to the start of the new policy (incidents only after this date covered).

There are 5 key dates relating to your policy and coverage.

‘Policy Start Date’ and ‘Policy End Date’.  This is the policy term and usually these dates are 1 year apart.  You are covered for valid claims made during the policy term, dependent on the ‘occurrence date’ and ‘retroactive date’.

‘Occurrence date’ is the date on which the incident happened, that later gives rise to a claim.

‘Claim date’ is the date you first know of a claim and the insurers are informed.

‘Retroactive date’ is the date after which the date of occurrence must be in order for it to be considered.

Background:

When we started in 2003 our policy was crafted and constructed to cover Coaches and what Coaches do. We soon discovered that some Coaches are engaged in other therapies and disciplines, some of which have "medical" elements, and we wished to provide cover for them also.  As a very simple example - Aromatherapy - does have a medical element to it; it might not be much, but it is there. So that's the background as to why "medical malpractice" is now included within the policy.

What does it mean to you if these terms do not apply to you?

The policy is now designed to cover a very wide range of business practices, so it is always possible that some clauses will have no relevance to you.

If the business practice you wish to cover has no "medical" element at all (and many we cover have NO medical element) then those clauses of a "medical nature" have no relevance to cover and can be safely ignored.  If a clause does not apply, then the fact that it is within the wording has no detrimental effect.  Quite simply, if they do not apply to you - they do not apply to you - so just ignore them.

The benefit of what may be "surplus wording" in some circumstances is that one standard set of wording can be used across many different business practices. The fundamental cover provided does not change because of surplus words.

We offer £1,000,000, £2,000,000, £5,000,000 and £10,000,000 (by agreement) cover per claim.

Many of our customers believe £1,000,000 cover is perfectly adequate.

Some have £2,000,000 of cover because their clients insist upon it. You will probably find this to be the case if you participate in any public shows/events. Some public venues are now even asking for up to £10,000,000 cover.

Others determine that due to the size of their business or the type of service they offer and the potential risk, the £5,000,000 is more appropriate.

Public liability covers a claim made against you by a member of the public, and that means it isn't necessarily a client. It is quite different to Professional Indemnity and covers an event that has no direct connection with your professional practice. It is meant to protect you financially, should someone held you or your business responsible for injury or property damage. A claim could be for almost anything where there is the opportunity to point the finger at you.

Example: A visitor trips up and breaks a leg while walking on the carpet in your office. Easily done, isn’t it? Yet, this is all it could take to receive a claim for tens of thousands of pounds and this is exactly the sort of thing Public Liability insurance covers.

Ever made a mistake or had a bad day at the office? It may be something you did that you should not have, or something you did not do that you should have. 

Example: In one of your coaching sessions you happen to give an inappropriate advice to your client which leads to them filing a claim against your business. Can you cope with the financial consequences following this, even if you didn’t do anything wrong?

The policy is provided as an annual policy and is intended to be kept in force for the full year.  There is an option to pay your premium by monthly installments but this does not mean that it is a monthly policy - you are simply spreading the cost.

However, if you need to cancel your policy, subject to the following conditions as detailed in Clause 7.8 of your policy:

If the policy is cancelled within 14 days

This policy has a cooling off period of fourteen (14) days which starts from either of the below dates, whichever comes later:

• the date you received this documentation or 
• the start of the period of insurance 

You can cancel this policy within the fourteen (14) day cooling off period by instructing Westminster Insurance Ltd or via the cancellation option in your online account. Provided you have not made a claim, you will be entitled to a refund of any premium paid, subject to a deduction of £15 of the policy fee which is retained to cover reasonable administrative costs. The policy will be cancelled with effect from the start date of the period of insurance and treated as if it never existed.

If you cancel the policy after 14 days

If this policy is cancelled after the fourteen (14) day cooling off period or following notice of cancellation by us, provided you have not made a claim, you will be entitled to a refund of any premium paid, subject to a deduction of a £35 policy fee and for any time for which you have been covered. This will be calculated on a pro rata basis based on the number of days covered.

If you pay your policy in monthly instalments, in this event, the period of insurance will equate to the period for which premium instalments have been paid to us.  The cancellation and amended period of insurance will be confirmed in writing by us. There is no refund payable when a monthly paid policy is cancelled.

Note

If we pay any claim, in whole or in part, then no refund of premium will be allowed

Most certainly - the answer is Yes.

We do not charge extra to add more business practices, either at inception or at a later date. However, there are certain disciplines within a higher premium tier, which would cost extra to add.  So if you added something that is in the same or lower premium tier than your current coverage then there would be no more to pay.

All you need do is contact us when you are ready and we will add them for you.

Note: Any Mid-Term Adjustment which requires a payment cannot be split into monthly instalments and needs to be paid in one go. The Mid-Term Adjustments follow the natural expiry date of the policy.