PI insurance provider Tenet has recently announced the inception of a new scheme that will provide its formerly appointed representatives cover.
The scheme will provide the same level of professional liability insurance cover that practising advisers can obtain by giving former representatives the ability to select run-off cover.
Tenet will be utilising Paragon Insurance, a subsidiary based in Guernsey, in order to create a product that will cover any advisers on the eve of retirement in the event that a business liability insurance complaint be made against them in the future.
The insurance rates will be based on whatever revenue the advisers may have earned during their tenure with Tenet in addition to the length of time that has elapsed since they retired from their serving in an advisory role for the firm.
There are few PI insurance providers that currently offer run-off insurance cover to its advisers; those that are in search for such cover routinely find that the expense to obtain PI insurance has become increasingly expensive as time goes on.
Tenet released a statement that said any of its practicing ARs have cover under the firm’s block policy scheme, but when an adviser retires or leaves Tenet, that cover will cease, and that will leave the adviser fully exposed to retrospective complaints with no possible ending point.
Keith Richards, development and distributing director for Tenet, said in the statement that the firm felt it was important to provide the ability to offer run-off cover to its former advisers, stating that it has been exceptionally hard to source satisfactory PI insurance cover on a historical basis in addition to its prohibitive expense, but by using the flexible nature of Paragon’s underwriting, Tenet has been able to bridge that gap in order to extend the range of its services to its advisers.