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PROFESSIONAL INDEMNITY INSURANCE
BROKING AND ADVISORY SERVICES
FOR SURVEYING FIRMS
OUR KNOWLEDGE: YOUR ADVANTAGE
CONTENTS
• Professional Indemnity (PI) insurance market update
• Efficient insurance buying
• Why choose Howden for PI?
• Howden claims handling
• Testimonials
• About Howden Insurance Brokers
• Award winning performance
• Contact us
1
OUR KNOWLEDGE: YOUR ADVANTAGE
PI MARKET UPDATE
• The Bad News
– Insurer appetite for firms that have done valuations for lending purposes remains limited
due to continued high volumes of negligence allegations
– Insurance rate for valuations for lending purposes at between 5% and 15% of income
(occasionally more), depending on claims history
– Firms with multiple notifications or settled claims continue to struggle to secure renewal
terms
– Primary layer of surveyors’ insurance generates c. £39m* premium income, per annum, to
insurers – 30% less than 2005 * To 31 December 2012
– Notifications arising from alleged negligent valuations of residential property rumored to
total in excess of £500m
– Sole practitioners and smaller firms hardest hit by rising premiums
– Rise in allegations relating to missed defects
OUR KNOWLEDGE: YOUR ADVANTAGE
PI MARKET UPDATE
• The Good News
– New insurers entering the market with a selective appetite for firms with an exposure to
valuations for lending
– Firms starting up and undertaking valuations for lending should not experience the same
issues with securing PII because there is no historic exposure to insurer
– Premiums are competitive for non S&V activity e.g. agency and project management
– Six years past the peak of the property market so starting to feel the beneficial impact of the
statute of limitation in relation to claims bought under contract
– Contributory negligence by lenders resulting in discounts in final settlement
– Valuation instructions on the increase and, in some instances, fees are increasing but,
beware, this is likely to lead to a corresponding increase in premium
OUR KNOWLEDGE: YOUR ADVANTAGE
PI MARKET UPDATE
Insurers’ perceptions of different surveying disciplines
High risk
Low risk
Source: Howden internal data as at October 2014
OUR KNOWLEDGE: YOUR ADVANTAGE
PI MARKET UPDATE
• Recent case law and important events
– Jackson Reforms of Civil Litigation – but how long before full impact is felt?
– Statute of Limitation and its correlation to the peak of the property market
– Growing acceptance of Liability Caps by clients
– Dr Oonagh McDonald’s report, ‘Balancing Risk and Reward’. Will
recommendations result in change?
– Personal liability
Matthews v Ashdown Lyons and Maldoom
− Multi million euro settlement against Colliers International
Titan Europe 2006-3 plc v Colliers International UK plc (in liquidation)
OUR KNOWLEDGE: YOUR ADVANTAGE
PI MARKET UPDATE
• Future areas of concern to insurers
– Return to the practices of 2007 – too many instructions in one day for too little
money
– Any evidence of industry wide behavior that might lead to a claim
– Overheating in the property market
– Firms taking on new areas of work without fully understanding the exposures or
having prior experience of the work i.e. Expert Witness, LPA receivership,
Green Deal etc.
– Increasing breadth of contractual liabilities, particularly on construction project
– The 2020’s interest only mortgage issue
– New forms of lending – Peer to Peer
– Cyber Liability – particularly for firms holding large amounts of personal date on
clients and/or tenants
OUR KNOWLEDGE: YOUR ADVANTAGE
EFFICIENT INSURANCE BUYING
• Start the process early – at least six weeks ahead of renewal
• Your proposal form represents your business; does it represent it well and is it
honest?
• Ensure the person in charge of buying insurance understands how to run the process
• Report your claims history accurately and fully. Analyse it and demonstrate the steps
you have taken to prevent re-occurrence
• Does your broker understand what you do and how you do it?
• If your premium is over £20,000 don’t ask more than three brokers to quote as
insurers can be discouraged from quoting if they see your proposal form more than
once
• Concentrate on improving risk management and ensure that risk management
policies are reflected in your proposal form
• Ensure your broker and insurer have a strong claims team – it’s not just about
premium
• Ensure you understand what your policy covers
WHY CHOOSE HOWDEN FOR PI?
What makes us different and what does it mean for our clients?
Knowledge We understand what our clients want and what insurers want. Our clients will get the right
cover, from the right insurer, at the right price.
Sector specialisation
We take time to understand the sectors our clients operate in. We understand the risks our
clients are exposed to. We know what they need from your insurance and what their clients
expect.
Claims service
Over £500m worth of claims settled on behalf of clients in the last four years. Our clients
have one of the largest in-house PII claims handling teams on their side to provide advice
and get claims settled.
Expertise
We have over 100 PII specialists. We know what we’re doing. Every member of our team
sits within 20 metres of someone with over 20 years experience.
Strength Our size and reputation gives us the ability to negotiate better premiums with insurers.
Size Large enough to make a difference with insurers but still small enough to offer great service
based on strong relationships.
Integrity We tell it how it is, providing honest and informed advice and guidance. If we say we are
going to do something, we will do it.
Keeping you informed
We ensure our clients have access to up-to-date information on factors that can impact
premium and risk management. We give clients the opportunity to benefit from lessons
learnt in other sectors.
Group support
The central management and operational support provided by the Howden Broking Group
allows our insurance experts to do what they are good at – insurance.
OUR KNOWLEDGE: YOUR ADVANTAGE
WHY CHOOSE HOWDEN FOR PI?
• RICS only preferred UK PI broker
• Represent over £20m premium per annum from the property and construction
sector
• Expertise across all areas of the industry from valuers through to project
managers, architects and civil engineers
• Recognised for our ability to find insurance for firms operating in high risk areas
and/or with poor claims histories
• Clients range from Sole Practitioners to some of the world’s largest property
consultancies
• Committed to developing our service offering and proactively helping clients
manage risk through the regular provision of e-bulletins, events and
complimentary services
• Play a leading role in driving the delivery of solutions to the challenges posed by
PI across the surveying industry
OUR KNOWLEDGE: YOUR ADVANTAGE
HOWDEN CLAIMS HANDLING
• How we work with you
– The largest PII claims team in the London market with over 30 members of staff
– In excess of £70m of claims settled on behalf of surveyors in the past 5 years
– Team led by Kevin Bailey who has over 30 years of London Market experience and
was previously employed by RICS insurance services
– Our strength and expertise reduces the time your partners/directors and employees
have to spend handling claims and reduces the likelihood of insurers repudiating
claims
– Strong, long term relationships with claims handlers at major insurers and a belief in
negotiating matters face to face
– The Howden claims team is based in the same office as your account handlers and
broker ensuring we provide a comprehensive, joined up service
– We work closely with clients to establish how best to present claims to insurers to
ensure maximum cover is received from the policy and to take account of personal
preferences
OUR KNOWLEDGE: YOUR ADVANTAGE
TESTIMONIALS
Can do is no match for have done :
“Thank you very much for handling our
Professional Indemnity insurance renewal again
this year. I was delighted with the result,
obtaining for us a sector leading two year deal,
and at a price that compares more than
favorably with market rates. I am sure that
market conditions will present us with a
challenge at next renewal and am grateful to you
for your advice in this regard. I would also like
you to convey our thanks to your claims
handling team, who continue to deal extremely
effectively with any matters that arise. We are
appreciative of the continuity of underwriting and
the sustained high levels of service and support
that Howden provide for us.”
LLP Secretary, top 20 UK Property
Consultants
“Having recently established my own surveying
practice I have found Howden to be extremely
helpful and approachable throughout the whole
process. In addition, the competitive premium
level is vital for a new company”
Sole practitioner surveyor
“Howden have arranged our
professional indemnity insurance
since 2006 and we have always
been impressed with their
knowledge of our industry, service
and premium. This has been
further endorsed by their
appointment as the RICS preferred
UK PI Broker. We therefore have
no hesitation in recommending
them to other firms”
Chairman
Independent Estate Agents
“Our relationship stretches back
almost 10 years which is testament to
the continuing high level of service
they provide us with. I would have no
hesitation in recommending Howden
as exemplary insurance providers.”
Partner & Chief Executive, UK top
20 Architectural practice
“From the outset we were impressed by the speed
of Howden’s response and the knowledge they
have of our sector. Throughout the process they
displayed a confident and constructive approach
and the meetings they set up with potential insurers
enabled us to fully explain our risk management
procedures. The client service team were
extremely helpful and we have no doubt that they
will be fully supportive if we need their assistance.
Howden eased us through what has in the past
sometimes been an anxious period and the
premium reduction was an excellent outcome..”
Director, Business Surveyors and Valuers
OUR KNOWLEDGE: YOUR ADVANTAGE
• Part of Hyperion Insurance Group an independent international insurance
group
*Includes FP Marine
2
– Broking* – Underwriting
ABOUT HOWDEN INSURANCE BROKERS
OUR KNOWLEDGE: YOUR ADVANTAGE
ABOUT HOWDEN INSURANCE BROKERS
0 10 20 30 40 50 60 70 80 90 100 110 120 130
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'06
'08
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£M
REVENUE: £125.7M
GROWTH: +67% IN 2013
1,300+ employees
56 offices
30 countries
• Howden Insurance Brokers Limited
is the Lloyd’s broking arm of Howden
Broking Group
• Howden Broking Group is part of the
Hyperion Insurance Group – an
international insurance intermediary
generating in excess of £160m
turnover per annum
• Over 60% of Hyperion is owned
by employees and management
• General Atlantic, the global growth
equity investment firm, holds just
under 30%
HOWDEN BROKING GROUP
OUR KNOWLEDGE: YOUR ADVANTAGE
ABOUT HOWDEN INSURANCE BROKERS
In addition to PI we can arrange the following forms of insurance
PEOPLE ASSETS LIABIILTIES
Personal Accident Property Employer’s Liability
Expatriate Medical Terrorism Public & Product Liability
Business Travel Business Interruption Environmental Liability
Kidnap, Ransom and Extortion Construction Directors and Officers Liability
Employee Health & Benefits Plant and Equipment Professional Indemnity
War & Political Risks Machinery/Electronic Breakdown Cyber Liability
Crime Intellectual Property Protection
Fleet Crime
Title & transactional liability
Insurance
OUR KNOWLEDGE: YOUR ADVANTAGE
UK
FINLAND SWEDEN
NORWAY
POLAND
GERMANY
NETHERLANDS
SPAIN TURKEY
ISRAEL
UAE
BERMUDA
USA
CANADA
COLUMBIA*
ECUADOR*
PERU*
CHILE
URUGUAY
BRAZIL
INDIA
HONG KONG MACAU
KOREA
SINGAPORE
TAIWAN
THAILAND
PHILIPPINES
MALAYSIA
INDONESIA
GUERNSEY JERSEY
Howden: global reach, local expertise
5
Revenue by Location of Insured Pro forma including acquisitions
11% US
20% UK
10% NORDICS
15% EUROPE
9% MIDDLE EAST & AFRICA
10% IBERO-
AMERICA
25% ASIA
PACIFIC
ABOUT HOWDEN INSURANCE BROKERS
OUR KNOWLEDGE: YOUR ADVANTAGE
AWARD WINNING PERFORMANCE
Hyperion Awards and Recognition
Howden Awards
2013: Insurance Insider Honours: Broker M&A Deal of the Year
2013: Reactions London Market Awards: Insurance Broking M&A Deal
2013: Recognised by the Sunday Times HSBC International Track 200 which ranks the UK’s private companies with the fastest growing international sales
2012: Awarded a Queen’s Award for Enterprise in International Trade
2013: Insurance Insider Honours: Broker of the Year
2014: The Hedge Fund Journal Awards: The Leading Insurance Broker
2014: Hedge Fund Market Awards: Best Insurance Provider.
2014: British Insurance Awards: Commercial Lines Broker of the Year.
71 FENCHURCH STREET
LONDON
EC3M 4BS
WWW.HOWDENGROUP.COM/SURVEYORS
CONTACT US
GREG HARRISON
T: 020 7133 1505
PETER LONDON
T: 020 7133 1449
JOANNE ROBINSON
T: 020 7133 1564
MATT FARMAN
T: 020 7133 1565
Howden Insurance Brokers is a subsidiary of Howden Broking Group Limited, part of
the Hyperion Insurance Group. Howden Insurance Brokers Limited is authorised and
regulated by the Financial Conduct Authority: Firm reference number 312584.
Registered in England and Wales under company registration number 203500.
Registered office: 16 Eastcheap, London EC3M 1BD.
This document or any portion of the information it contains may not be copied or reproduced
in any form without the permission of Howden Insurance Brokers Limited, except that clients of
Howden Insurance Brokers Limited need not obtain such permission when using this report either
for their internal purposes or to give to their clients.
The information contained herein is based on sources we believe reliable and should be understood to
be general risk management and insurance information only. Howden makes no representations or
warranties, expressed or implied, concerning the accuracy of information contained herein. The
information is not intended to be taken as advice with respect to any individual situation and
cannot be relied upon as such.
Copyright © August 2014 Howden Broking Group