Professional Indemnity insurance Scheme Renewal – 2021 - 22

renewed for a further 12 month period, from 1st November 2021. As most readers will know, this annual negotiation renews the framework under which your individual PI policies are placed and sets the Scheme insurers’ broad strategy for the insurance year ahead. Perhaps even more so than last year, those negotiations were marked by very difficult discussions on some complex issues: The continuing capacity challenges in the PI insurance market and the reshaping of appetites for UK construction risks amongst those insurers prepared to continue to offer PI cover. What level of macro-level pricing changes are appropriate to ensure our Scheme can continue to deliver on its promises of providing broad, sustainable protection which is both effective and value for money. The wider PI insurance market response to the need to clarify their cyber liability exposures. The continuing ‘fire safety crisis’ in the construction industry and the insurance markets’ reactions to it. There is undoubtably an increased awareness today of the systemic problems in certain parts of the industry, as has been only too clearly highlighted by the Grenfell Tower inquiry. This has served to reinforce the need for us to continue to best advise our clients in the context of what does appear to be a much more widespread problem than initially feared, particularly on the materials supply side. Securing the necessary underwriting support has been a challenging exercise for 2022. There have been some major losses of insurer capacity along the way, as some underwriters believed that the protection we sought to offer was too great or the pricing structure insufficient. Walking the tightrope between, on the one hand, ensuring that we have insurers of sufficient quality to meet the claims promises we make, whilst on the other, ensuring that we continue to offer a value for money product is more difficult than ever. In order to ensure that the more extreme insurance market responses do not become a feature of our Scheme, we outline below the various changes to our cover specification that we have negotiated with our insurance partners. Inevitably, there is an element of ‘give and take’ to the proposals but in the round, having regard to the market alternatives in each area, we feel that the compromises struck see our clients well placed to take advantage of what the future has to offer, whilst providing protection against the problems of the past.