Insurance brokers provide insurance products to both individuals and companies. Brokers are ordinarily independent individuals or firms without affiliation to any particular insurer.
The Courts in recent times (and the Insurance Act 2015) have expanded the duty of care owed by insurance brokers to their clients and have readily supported claims issued for negligence where the broker has recommended or mis-sold an insurance product (particularly in circumstances where a financial incentive is offered by an underwriting insurer).
We provide expert legal advice on professional negligence claims against insurance brokers and underwriters. If you have been given bad advice or have a complaint about an insurance broker it is important that you take independent legal advice to seek compensation for your loss before the time limits expire (usually six years).
Complaint about an insurance broker?
You may have a complaint against an insurance broker if they have failed in their task to consider your needs as a client and as such you have been recommended an insurance policy which is not suitable for your needs.
Insurance brokers are held to a high standard of care. The UK financial services industry in general is regulated by both the Prudential Regulation Authority (PRA) and the Financial Conduct Authority (FCA). In particular, brokers are mandated to conduct themselves within the framework set out by the FCA. In addition, insurance brokers are regulated by the British Insurance Brokers’ Association (BIBA) which includes a code of conduct for brokers to follow including:
- ABIDE BY ALL RELEVANT LAWS, PRINCIPLES AND REGULATIONS. Understanding and ensuring we comply with regulatory principles and work within the law.
- ACT WITH INTEGRITY AND HONESTY. We should conduct ourselves in a fair, reliable, trustworthy and respectful manner with all our stakeholders.
- ACT IN THE BEST INTERESTS OF EACH CLIENT. We have a duty to act in a manner which pays due regard to the best interests of each client and ensure decisions and recommendations are based on a clear understanding of their needs, priorities, concerns and circumstances.
- ACT WITH SKILL, CARE AND DILIGENCE. We act at all times with high levels of skill, care and diligence.
I have been advised to enter into an unsuitable insurance policy
If you have been provided bad advice and subsequently entered into an insurance policy with insufficient cover, then you may have a claim for compensation. For example, if you have been mis-advised to enter into any of the following insurance policies:
- Professional indemnity insurance;
- Public liability insurance;
- Travel insurance;
- Before the Event (BTE) insurance cover (for example for legal fees);
- After the Event (ATE) insurance policies (covers claimants following an adverse costs order made against them);
- Employer’s liability insurance.
Insurance brokers are used by several professionals and businesses for insurance products. Your broker could be negligent if they have failed to renew insurance within the timeframe allocated, failing to inform you of your insurance being invalid, not insuring all risks which was specified and not following your instructions resulting in financial loss.
Common examples of negligence by an insurance broker
- Failure to provide adequate insurance cover for your needs;
- Failure to follow your instructions;
- Failure to renew a policy once you have advised them to do so;
- Failure to insure all risks that you have specified; and
- Providing a far too restrictive insurance product.
Which duties does an insurance broker owe to their clients?
In Jones v Environcom [2010] the Court assessed insurance brokers’ duties to clients. In particular, the Court held that an insurance broker is under a duty to:
- ensure the client understands what has been advised;
- advise on duty to disclose all material facts and explain the consequences of failing to do so.Â
How do I prove that my insurance broker has been negligent?
Like all negligence actions, in order to claim compensation, the following three elements need to be made out by a claimant to prove the tort of negligence against an architect:
- Duty of care – The defendant insurance broker/firm owed the claimant a duty not to cause the type of harm suffered.
- Breach of duty – The insurance broker breached the duty owed.
- Causation – This has two elements, both of which must be proved i.e. (a) factual causation in that the claimant must prove, but for the defendant’s negligence, they would not have suffered loss and (b) legal causation or remoteness in that the defendant’s negligence was the legal cause of loss.
Book an Initial Consultation with our Professional Negligence Lawyers
Do you have a claim against a professional? If you want expert legal advice, do not delay in instructing us so we can assess the legal merit of your case.
We can often take on such claims on a no win no fee basis (such as a Conditional Fee Arrangement) once we have discussed the claim with you and then assessed and advised you on the merits of the proposed professional negligence action.
Our expert legal team of leading Professional Negligence Solicitors & Barristers can provide urgent help, advice or representation to you. Just call our Professional Negligence Lawyers on 02071830529 or email us now.
Instruct Specialist Professional Negligence Solicitors
We are a specialist City of London law firm made up of Solicitors & Barristers operating from the only law firm based in the Middle Temple Inn of Court adjacent to the Royal Courts of Justice. Our team have expertise in advising on claims for compensation against professionals that have fallen below the standard expected, which causes clients financial or personal loss. We are experienced in bringing successful claims against negligent solicitors, barristers, financial advisers, insurance brokers, surveyors, valuers, architects, tax advisers and IFAs.
