Businesses and individuals purchase insurance policies for the purpose of benefitting from their protection in the event of a loss. When the worst happens, you expect your policy to respond in a timely and fair manner, indemnifying you or offering protection when you need it.
However, selection of the wrong insurer, inappropriate policy limits or deductibles, and the breach of important conditions in insurance policies, can all result in unsatisfactory claims outcomes that could directly impact the financial health of your organisation.
As the regulatory environment continues to evolve in Europe and as society becomes progressively more litigious, achieving positive claims outcomes becomes increasingly important.
Claims can be complex and the investigation process can be lengthy. When dealing with Professional Indemnity (PI) or Directors and Officers (D&O) insurance, you may be investigated by an authority scrutinising possible criminal, administrative, or regulatory misdemeanours. Furthermore, in
complex cases, it may not always be immediately clear whether particular types of losses are covered under your existing insurance policies, and insurers can and do raise legal defences in order to attempt to deny claims which they believe are not covered.
How policies respond in the event of a claim is the true test of insurers and insurance brokers. The final outcome of whether a claim is paid in full, partially paid, or declined is affected by a number of factors. Before a policy incepts and before a loss occurs, it is vital to have a clear understanding of your risk profile and how any insurance will respond in various loss scenarios. There is no international standard for claims handling, as each client’s needs vary considerably, along with the nature, severity, and frequency of losses they will experience. However, in order to have peace of mind, you must have confidence in the quality of the insurance programme your broker has placed for you, your broker’s technical knowledge and claims handling ability, and the quality and professionalism of the insurers underwriting your risk.