Financial Planners Professional Indemnity Insurance
Business Insurance Specialists Pty Ltd is a specialist provider of Financial Planner Insurance. We have negotiated competitive coverage and terms from insurers for many practices.
The Financial Planning industry is undergoing massive change and upheaval, with the divestment of the planning arms from the major banks. With this exit, we notice that a substantial number of boutique firms are commencing operations. With our understanding of the market, we can obtain the required coverage for your business.
What Professional Indemnity limit is required for Financial Planners?
Due to Financial Planning firms being ASIC Licensees, your insurance requirements are determined by the Corporations Act. The minimum requirements are a limit of $2,000,000 excluding legal costs, meaning that legal costs are in addition to the limit. This is detailed in ASIC Regulatory Guide 126 within the Corporations Act
Depending on the turnover of your business, this limit may need to be increased as per ASIC Guidelines. Separate to this, we are aware that Financial Planners may need more coverage than the statutory required minimum. Due to the potential size of claims that may occur due to negligent advice and resultant financial loss, this should be considered.
What are factors in determining insurance cost for Financial advice firms?
The number of insurers and their capacity to offer terms has shrinked markedly in recent years. With recent enquiries and banking commissions mandating required actions that impose increased responsibilities on planners, insurance is a fundamental risk management tool. Major factors that insurers use in determining cost is the risk profile of the business, type of advice being provided, experience and competency of management and staff, risk controls in place and size.
Financial Planner insurance benefits
Our insurers meet ASIC guidelines with policy benefits including RG 126 Compliant wording, Civil Liability Insurance clause. Activities such as providing tax (financial) advice services are covered, and loss of documents and official investigations hearings cover is insured also.
Professional Indemnity coverage is ‘claims made’ meaning you must report to the insurer immediately any advice from a client whereby they believe you provided wrongful advice whether by error or omission. If the writ or advice is provided after the next renewal date, you have no insurance coverage.
Business Insurance Specialists Pty Ltd has committed to providing market leading Financial Planner Professional Indemnity insurance and assisting planners in obtaining appropriate and competitive cover.
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