What is a Miscellaneous Professional Indemnity (PI) Risk?

As an insurance professional, you might have encountered this question: “What exactly is a miscellaneous Professional Indemnity risk?” The key to understanding what we mean by a “miscellaneous risk” is to think about what it 𝐢𝐬𝐧’𝐭.

A miscellaneous PI risk usually refers to any profession or business that needs protection against claims of negligence, errors, or omissions in the advice they provide but doesn’t fall into the usual predefined industry categories like:

 (The professions above typically have custom wordings and proposal forms or addendums tailored to their risk.)

So – what kind of activity falls under the PI Miscellaneous Category?

The list below is not exhaustive. There are hundreds of occupations that fall into this “other” category but these are some common ones that we see at Berkley Insurance Australia.

Challenges for Miscellaneous Risks

Miscellaneous professionals don’t have a standard Professional Indemnity policy designed specifically for them, so they are grouped into the PI miscellaneous category. But make no mistake—they can face similar risks for the professional services they provide as the professional services provided by more traditional PI occupations.

For brokers, identifying and placing coverage for these risks can be challenging – but also provides you with an opportunity to demonstrate expertise and value to clients.

Tips for brokers when placing a miscellaneous risk:

Thoroughly Understand the Risk:

Ask the client for a copy of their most recent resume or online professional profile. Despite business descriptions such as “management consultant” being widely used – the activities of one “management consultant” may vary significantly from another. Having the client’s resume gives you and the underwriter greater insight into their background and the type of work they may involve in – potentially resulting in a more timely and successful submission. Click here if you Want to learn more about presenting a risk to an underwriter.

Detailed information on past work:

Ask your client for detailed information about the five largest contracts they have had over the last two years. Details could include the income value, project value, client details, length of the project and description about what their roles and responsibilities were. This will help you and the underwriter get a sense of their business.

Business Description:

Ensure that the business description fully captures the work your client involves in. Ensure that your client is reviewing this business description at every renewal and advising you of any changes. PI policies are claims made policies so pay particular attention to the retroactive date on your client’s PI policy. You need to ensure the business activities listed include activities that may have been conducted in the past that the client still requires coverage for. Click here if you Want to learn more about the importance of the professional services business description?

Manual Activities:

If your client involves in any of these activities: sale, manufacturing, installation, construction, alteration, repair, servicing or treating of any goods, you should check the PI policy wording to determine whether it offers appropriate cover for them. If your client has any of these exposures, highlight them in their submission.

Be across Jurisdictional Risk:

If your client operates virtually, ask detailed questions on overseas work – especially any work based in North America. PI policy usually automatically excludes Jurisdictional coverage for North America.It may be provided at the underwriter’s discretion – usually for an additional premium.

Higher Limits:

Prepare to ask your client more questions. If they have requested a higher PI limit of say $10m or $20m It may not be cause for concern. Underwriters often see request higher limits in connection with higher risk industries or activities. If a higher limit is requested, the underwriter will likely need more information about the risk.

Ensuring your clients in miscellaneous occupations have the right PI coverage is crucial. It protects them in the event of a claim in relation to the professional services they have provided. Don’t overlook the importance of safeguarding these “miscellaneous” professionals!

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Important Notice

Berkley Insurance Company (limited company incorporated in Delaware, USA). ABN 53 126 559 706 t/as Berkley Insurance Australia is an APRA authorised general insurer. Information provided is general only. Intended for brokers and has been prepared without taking into account any person’s particular objectives, financial situation or needs. It is not intended to constitute legal advice. You should always obtain legal or other professional advice appropriate to your own circumstances. Insurance cover is subject to terms, conditions, limits, and exclusions. When making a decision to buy or continue to hold a financial product, you should review the relevant Policy Wording.