What are clients entitled to know about your insurance?

Published: Sunday, 1 October 2023

How much should you disclose and to whom?

Have you ever wondered what, if any, information about your Professional Indemnity Insurance
needs to be disclosed to your clients?

Provision of Service Regulations

This question is governed by Provision of Services Regulations 2009. Originally introduced in 2009 to implement EU Directive 2006/123/EC, the European Union (Withdrawal) Act 2018 preserved the Provision of Services Regulations 2009 (as amended in 2014) for UK nationals and businesses established in the UK and formed under UK law . The regulation requires service providers to provide specific information regarding their services and their regulatory status to their current and prospective clients.

All professional service firms who are required to hold professional indemnity insurance, including solicitors, accountants and insolvency practitioners are required by law to disclose the following:

• The contact details of the insurer, and
• The territorial coverage of the insurance.

There is no requirement or need to disclose any further details, e.g. the policy number or the level of coverage, unless requested.

It is worth checking with your professional body to see if they have agreed a draft wording of a disclosure.

Do I need to disclose the level of cover arranged?

The simple answer is no. There is no requirement or indeed a need to disclose any further details specifically the policy number or the level of coverage.

You may be occasionally asked by a client to provide proof of insurance e.g. for a specific contract, to fufill approved supplier standards. This can be provided in a format called “Verification of Insurance”, “Certificate of Insurance” or “Confirmation of Insurance”. The document will typically only show the identity of the insurer, the policy number, the policy period, level of cover arranged. Ask your broker to provide this separately where required.

How does the information need to be presented?

The regulations do not require that the information is made available to clients in the same way. The range of options include:

• a website
• promotional brochures about the firm’s services
• an engagement letter
• on a letterhead; or
• by a notice displayed at the firm’s offices.

They do, however, require that the information is supplied in a clear and unambiguous manner and in good time before the conclusion of the contract or before the service is provided.

Anna Glebecka
Account Executive, Ntegrity

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