Many individuals ask whether they need to take out Professional Indemnity (PI) insurance when they leave a firm or retire. The answer generally is no, provided that the firm for whom you worked continues to trade.
The PI policy covering the ongoing business would usually automatically cover partners and employees who leave or retire from the firm. However, if you are a sole practitioner or it is a small practice which is wound up on your retirement, then you will need run-off cover to protect you against a claim for work previously done.
There are several products that will protect an individual once they wind up a business, but this can be expensive given the need for at least six years’ cover after retirement (and twelve years if contracts have been signed under seal).
In the main, only those insurers who provided cover while you were trading would be prepared to provide run-off cover so you should contact your existing broker. For members insured through RIBA Insurance Agency it is possible to purchase a policy with a single premium which covers you for claims brought for up to six years after retirement.
Contact RIBA Insurance Agency via uk-pi@ajg.com or telephone 0207 234 4025.