Citing a surge in professional liability insurance claims due to the financial crisis as their motivation, insurer Vero/APUA’s casualty head Alex Green stated that the firm received approximately 60 claim notifications at the height of the worldwide banking crisis. Notifications have remained at elevated levels from the financial services industry, which before the credit crunch was responsible for approximately five instances per month.
Vero has decided to offer a choice of two policy wordings, as its current policy provides a large-scale cover which many not be appropriate or required by a significant percentage of their policyholders.
Mr Green stated the insurance firm would continue in offering its traditional extended professional indemnity insurance policy cover to financial planners. However Vero would also begin to offer new wording in the standard version of their policy which had been closer in coverage to other marketplace wordings.
The Vero casualty head stated that the new policy is designed to cater to smaller firms or those that have the need to seek a balance between their professional indemnity insurance cover costs with the other expenses inherent in running a modern investment advisory or financial planning firm.
The policies will have two different price points in most cases, said Mr Green. Financial advisers will have the ability to receive quotes on both policies and then select the terms and price that will be most beneficial to their business, he added.
Mr Green also sated that the new policy was specifically designed to provide a greater number of choices to financial advisers regarding the coverage and cost of their insurance policies.