TSA Members Professional I ndemnity I nsurance Scheme TSA Members Discussion Group 6 th Nov 2008 Lockton Companies International Limited. Authorised and regulated by the Financial Services Authority. A Lloyd’s Broker.
Contents � TSA Members scheme overview � The future of the TSA Members PI scheme & raising the PI minimum requirement to £500k AOC � Claims & Risk Management 1
2 Combined TSA Members Fee I ncome Fee (£ Mil) 2008 2007 2006 2005 2004 35 30 25 20 15 10 5 0
3 Rates 2008 Combined TSA Scheme Rates 2007 2006 2005 2004 1 0.9 0.8 0.7 0.6 0.5 0.4 0.3 0.2 0.1 0
TSA Members Scheme Overview � Lockton have managed the TSA Member Scheme for over a decade � Underwritten by Royal & Sun Alliance � Exclusive to the TSA Members through Lockton Policy wording written by Lockton for the members � � Costs in addition � Policies on an Any One Claim Basis � Proposed minimum £500,000 any one claim � Policy is designed to go beyond the basic RICS minimum required levels of PI cover 4
The Future of the PI Market � Significant price increases for Surveyors, Architects and any profession involved in the construction industry � PI Policies becoming more restrictive as the market hardens � Construction industry continues to decline � Deepening global financial crisis damaging insurers asset reserves � Safety in numbers – TSA Scheme will continue to offer peace of mind and added protection from a hardening market 5
Transportation Presentation Claims & Risk Management Lockton Companies International Limited. Authorised and regulated by the Financial Services Authority. A Lloyd’s Broker.
Common Causes of Claims Lack of Client’s No terms of Inadequate Not understanding supervision expectations engagement client’s brief client’s needs not met Operating outside core expertise Silo mentality; office rivalry Corner-cutting due to workload Missed time limits * Unskilled client management* Inadequate report/letter writing Arrogance – Careless Miscalculation failure to record Insufficient Poor interpersonal check detail Inter-departmental keeping peer reviewing communication stress 7
Unskilled Client Management � “Look after your clients, and you will be managing risk; fail to manage risk, and your clients will suffer” � Happy clients are less likely to bring claims even if something goes wrong � Unhappy clients will look for a problem 8
Taking On New Clients � Pause before pressing ‘go’! � Is this a client you want to act for? � Can you act without any conflict? Have you got the skill and knowledge to do what they want, and the � resources to do it when they want it? � Think carefully about taking on a client if you can’t answer ‘yes’ to these questions 9
The Paper Trail of Evidence 1 Contracts or Letters of Engagement 2 3 File Notes, plans & All forms schedules of Correspondence 4 6 5 Minutes & Conversations in Site Notes Photos Attendance Notes person or & Sketches by phone 8 9 10 7 All Computer Records Operating Hot & Cold Daybooks & of procedures Reviews / Diaries E-mails & Data Internal Audit 10
Conclusion � PI Market set to harden � Increasing litigious environment due to the economic downturn � The consequential losses of facing a claim will usually surpass the value of the error � TSA are raising the minimum PI levels to £500k � Looking to introduce a TSA Members specific D & O Scheme 11
Key Points Safety in numbers – The scheme offers protection simply not � available on the open market Look after your clients and you will be managing risk � 12
The TSA Scheme providers Contact: Jonathan Bogan 0117 906 5025 jonathan.bogan@uk.lockton.com Lockton Companies International Limited. Authorised and regulated by the Financial Services Authority. A Lloyd’s Broker.
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