The Professional Indemnity (PI) market is currently offering customers the "best deal", it has been claimed.

While poor capacity in recent years may have meant premiums were higher, an analyst suggests that the entry of new insurers into the marketplace now presents firms with greater choice and better value for money.

James Dieppe, financial services analyst at Datamonitor, advises: "The chances are that five years ago the [PI] market was [more] profitable.

"Recently what we have seen is lots of new providers being attracted into the market."

He adds that 2005 saw a particularly high number of new insurers enter the sector, helping to increase affordability for those seeking PI cover.

According to the analyst, these new entrants are likely to offer lower premiums as they seek to establish themselves in the PI market.

Mr Dieppe recently listed PI for lawyers as one of the largest areas of business within the sector.