Professional Indemnity Claims: 6% Increase in Two Years

The landscape of Professional Indemnity (PI) insurance has witnessed significant shifts. Data from Marsh India shows a 6% rise in total claims under PI policies over two years. The claims are spread across various regions, with 36% from the US, 16% from the UK, 12% from India, and the rest from other countries.

The increase is attributed to complex solutions in CMT sectors. Common causes include contract breaches, service negligence, and failure to meet targets. Cyber-related issues have exacerbated risks, and negligence in service delivery accounts for over 45% of claims. The claim amounts range from $20m to $100m.

In 2022, PI insurance prices had an 11% YoY increase. Large companies saw marginal premium hikes, while mid-sized and small firms faced a 66% rise in deductibles. Blended PI and cyber insurance programs also became costlier. Insurers are adopting conservative stances due to high-value claims, emphasizing policy details and contractual aspects. The rise in cyber incidents further complicates matters, underlining the necessity for comprehensive PI and cyber insurance to handle emerging risks.

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