Why PI Insurance matters
By Stephen Lewis
2019-08-12
Lycetts have been arranging insurance for arboricultural and forestry consultants for over 30 years and would recommend that as a minimum Professional Indemnity is seriously considered. As a professional, you owe a Duty of Care to anybody who might reasonably rely upon your advice or services, whether you charge a fee for these or not.
Previously in the event of a claim, incidents may have been waived off with a begrudging acceptance that "accidents do happen". Today, people demand higher standards of service, are more certain of their rights as consumers and are reminded of the "rewards" that can be reaped from seeking compensation through legal action. If you already have cover in place, you should consider whether the indemnity limits you have chosen are adequate in today's environment taking into account the ever seemingly increasing size of awards for personal injury claims.
Professional Indemnity is an insurance designed to meet the cost of defending claims made against you for alleged professional negligence (any negligent act, error or omission). Professional Indemnity not only covers defence costs but will also pay for any damages and claimants' costs should they be awarded against you.
There is also a need for Public Liability insurance as you will be working at third party properties. Whilst the Professional Indemnity insurance will cover you in respect of errors or omission in advice given it will not cover you in respect of claims arising from damage caused to third party property or injuries to members of the public whilst carrying out surveys. We have seen incidents when a gate has been left open and a dog has escaped which was then hit by a car, the owner held our client responsible for the considerable vet fees. If aerial tree inspections are undertaken, then there is also a risk of deadwood being dislodged and cause damage or injury.
If you are engaging anyone to assist with the business be this office staff, sub consultants or additional persons to assist with aerial inspections you will also need to arrange Employers’ Liability insurance. Any person you engage in these capacities will be working under your control or supervision and it is highly likely that you will be liable for any injury or illness that might occur, in the course of their duties.
In the event of an accident, and failure to arrange Employers’ Liability cover where an employer/employee relationship exists you may be exposed to deal with substantial claims from employees for compensation yourself. You may also face prosecution under the Health and Safety legislation for non-compliance with the Employers’ Liability (Compulsory) Insurance Act 1969.
Case Study 1
Our client was instructed to carry out a survey of a tree in their back garden and comment on the condition. The client undertook a standard VTA and reported back to the owner stating that the tree was nearing the end of its natural life and was in poor health, recommending that it be removed within 6 months.
A number of years later, our client received a letter from a solicitor acting on behalf of the owner who had issued Court proceedings against a number of parties. This was following the failure of a large limb which caused considerable damage to his neighbour’s house.
As our insured had Professional Indemnity in place, his insurers were able to take over the dealing of the claim and with the assistance of their solicitors, quickly defended the claim at no cost to our client. It became apparent, some time after our client had been instructed, the owner had engaged another consultant, whose conclusions agreed with those of our client’s findings.
Case Study 2
An arborist was engaged by a local council to survey all the trees within their geographical limits and recommend any works that he deemed necessary with a view of them undertaking the contracting works.
One of the trees in question was close to a boundary wall, but the arborist in question failed to inspect the back of the tree as access was difficult. If he had have done so, a serious fungal infection would have been identified. The result was that the tree failed ,causing life changing injury to a member of the public.
The arborist didn’t deem it necessary to obtain Professional Indemnity insurance and was left to deal with the claim personally.
Case Study 3
An estate owner had properly arranged cover for the estate and activities carried out within its grounds including £10M Public Liability. Unfortunately, a minor was hurt suffering life changing injuries meaning that they would need a lifetime of round the clock medical assistance. The courts deemed that the claim was worth in excess of £15M and instructed insurers to pay the injury party the full limit of the policy. The estate weren’t in a position to pay the balance so the Court instructed them that if the estate was sold proceeds would be paid to the injured party up to the shortfall.
Whilst this third case study is an extreme example, it does go to show how the Courts react to such incidents and the power they have to take ownership of your property which in some cases could mean your business or house.
If you wish to discuss your own requirements, Stephen can be contacted at:
Stephen Lewis
Associate Director
Tel: 01483 489 291 Direct Dial: +44 (0)1483 485 022
Lycetts, 14A High Street, Knaphill, Woking Surrey GU21 2PE
stephen.lewis@lycetts.co.uk www.lycetts.co.uk