1. Review the Organizational Structure
Always examine your client’s organizational chart to determine which entities need coverage:
- Parent companies – Usually the main insured
- Subsidiaries – May or may not be automatically covered
- Related entities – Joint ventures, partnerships
Important: Unlike Management Liability policies, Professional Indemnity policies do not always cover subsidiaries automatically. Check the policy wording carefully.
2. Check for Changes in Business Activities
Has your client:
- Expanded into new service areas?
- Taken on larger projects?
- Started working in new industries?
Any of these changes could affect coverage requirements or exclusions.
3. Review Claims History
Before renewal, ensure you have a complete picture of:
- Current open claims
- Recently closed claims
- Any circumstances that might give rise to claims
Failure to disclose known circumstances can void coverage.
4. Verify Coverage Limits
Are the current limits still appropriate?
- Has revenue increased?
- Are contract requirements higher?
- Have industry standards changed?
5. Check Retroactive Dates
Ensure the retroactive date provides adequate protection:
- Ideally, no retroactive date (full prior acts cover)
- At minimum, covers the period when work was performed
- Be wary of restricted retroactive dates imposed at renewal
6. Review the Insuring Clause
Make sure the operative clause provides broad coverage:
- Look for "civil liability" wording
- Avoid policies limited to "breach of professional duty"
- Check for any sub-limits that might apply
Need Help?
Our underwriting team is always available to discuss coverage requirements and help you find the right solution for your clients.
Phone: 02 8823 8888
Email: info@ftainsurance.com.au