Any claims resulting from the credit crunch and the impact of the US sub-prime lending crisis on the UK market could put pressure on Professional Indemnity (PI) insurance premiums, it has been asserted

Neil Pointon, Chief Executive of specialist Lloyd's of London insurance broker PYV, states that a rise in the number of claims received does not necessarily mean that independent financial advisers (IFAs) and mortgage intermediaries will be deemed to have acted negligently.

But he notes that such an increase in claims "is ultimately bound to put pressure on PI premiums" and that practitioners within the industry "might be prudent to review the levels of cover they have to ensure that they have got enough to cover all their exposure".

This could mean increasing the level of cover afforded by PI policies for many IFAs or other professionals regulated by the Financial Services Authority, as such individuals often purchase only the minimum cover required by the regulatory body.

"Buying increased levels of cover is predominantly to provide protection against the potential for claims to become larger or more frequent," Mr Pointon explains.

PYV are one of the UK's leading providers of professional indemnity insurance. This news article has been produced by Adfero in collaboration with PYV and its unauthorised use is not permitted.