APRA's 2022 Data Shows Stable PI Claims and Premium Reduction
Insights into the Australian Professional Indemnity Insurance Landscape
The information on this website is general in nature and does not take into account your objectives, financial situation, or needs. Consider seeking personal advice from a licensed adviser before acting on any information.
The Australian Prudential Regulation Authority (APRA) has released its latest National Claims and Policies Database, providing valuable insights into the professional indemnity (PI) insurance sector for the 2022 underwriting year.
The data indicates that PI claims payments for non-facility business remained relatively stable at $1.111 billion, a slight increase from $1.109 billion in the previous year.
Notably, the gross premium for PI insurance experienced a 6% decline, dropping from $2.954 billion to $2.775 billion. This reduction suggests a shift in the market dynamics, potentially influenced by increased competition among insurers and a more selective underwriting approach.
The number of PI claims with payments made for non-facility business decreased by 8% to 17,433, indicating a possible improvement in risk management practices among professionals or a more stringent claims assessment process by insurers.
For professionals and business owners, these trends underscore the importance of staying informed about the evolving insurance landscape. While the stability in claims payments is reassuring, the decrease in gross premiums may reflect changes in policy terms, coverage limits, or insurer appetite. Engaging with knowledgeable insurance brokers can provide clarity and ensure that coverage remains adequate and competitively priced.
As the market continues to adjust, professionals should proactively review their insurance policies to align with current industry standards and safeguard against potential liabilities.
Please Note: We do not endorse any specific products or companies. Some content is sourced from third parties, including press releases, and may not be independently verified for accuracy or completeness.
Recent industry reporting on ASIC’s continued attention to product governance is a useful warning for Australian professionals who help design, recommend, distribute or review financial products. While design and distribution obligations are usually discussed as a licensing and compliance matter, they can also create a professional indemnity exposure when advice, documentation or oversight falls short. - read more
Recent insurance market commentary has again highlighted a growing challenge for Australian professional service firms: cyber incidents are no longer just an IT problem. When a system outage, data handling error, failed implementation, software defect or poor security recommendation causes a client financial loss, the dispute can quickly move into professional indemnity territory. - read more
Fresh small business finance reporting has put insolvency and cash-flow pressure back near the top of the risk agenda. While headlines often focus on company failures, tax debt, late payments and tighter household spending, the professional risk message is broader: when clients are under financial strain, expectations harden and disputes can escalate quickly. - read more
Fresh industry attention on ASIC’s internal dispute resolution data has put complaint handling back in the risk spotlight for financial services firms, advice practices and the businesses that support them. While IDR reporting is often viewed as a compliance obligation, it can also reveal the early stages of a professional indemnity exposure: a dissatisfied client, a disputed recommendation, a delayed response, an alleged error or a breakdown in communication. - read more
Fresh industry attention on ASIC's expectations for compensation arrangements is a timely reminder that professional indemnity insurance should not be treated as a once-a-year renewal task. For Australian professionals who provide advice, compliance support, financial services, consulting, design, technology or outsourced business services, the adequacy of cover depends on how closely the policy matches the work actually being performed. - read more
No comments yet. Be the first to share your thoughts.