1 Pro-Tect Asset Protection Protection for Partner s Dependants against Catastrophic Negligence Claims Developed exclusively for Solicitors by ACE European Markets & Professions
2 PRO-TECT - PROTECTION FOR PARTNER S DEPENDANTS Pro-Tect has been developed exclusively by ACE European Markets and Professions. It has been designed to meet the needs of professionals who wish to protect their families and dependants from a catastrophic negligence claim which could threaten their financial security. Whether a salaried or equity partner, the exposure to unlimited liability remains the same. The majority of solicitors still prefer the benefits of partnership status, however the downside of unlimited joint and several liability is becoming an increasing concern to partners. The size of claims is growing in terms of quantum and solicitors are facing a higher number of claims each year. Limited Liability Partnerships have gained in popularity but do not solve the problem of exposure to personal liability. Pro-Tect enables partners to remain as a partnership with the added peace of mind that if their business fails, their homes will remain secure. Thus Pro-Tect offers the ultimate security to the partners families and dependants. Note: This is a guide - all coverage is governed by the terms, conditions and limitations of any policy issued. A policy wording can be obtained from Professions.
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4 PRO-TECT - PROTECTION FOR PARTNER S DEPENDANTS How does the policy work? The dependants named by the partners in the practice will receive a payment up to the sum insured in the event that: 1. A professional negligence claim exceeds the total limit of indemnity maintained by the practice; and 2. The resulting uninsured exposure contributes to the insolvency of the practice. The dependants can use the monies from Pro-Tect to secure the family home by purchasing the assets of the insolvent partner.
5 The Benefits Pro-Tect can provide cover up to 10 million. Higher limits are available by special arrangement. No excess applies under the policy. Insolvency does not need to occur immediately following a catastrophic claim. A valid claim under Pro-Tect can be made at anytime within 12 months of the anniversary of payment being made under the partnerships professional indemnity programme. The professional negligence claim only needs to contribute to the insolvency; it does not need to be the sole cause. Once a payment has been made under Pro-Tect, the allocation of monies is made by the distribution agent as agreed by the partnership.
6 PRO-TECT - PROTECTION FOR PARTNER S DEPENDANTS Why buying more professional indemnity insurance may not be the only answer If your firm is unsure whether it has purchased sufficient professional indemnity cover or considers that the purchase of additional professional indemnity cover may be seen as a deep pocket for claimants to pursue. Pro-Tect provides a solution to provide funds to your family and dependants in the event that the partnership is hit by a catastrophic professional negligence claim. In the event of an Insolvency following a catastrophic claim against a partnership, the real losers are the families. Pro-Tect provides peace of mind to the partners and security to the partners family.
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8 PRO-TECT - PROTECTION FOR PARTNER S DEPENDANTS Your Questions Answered Q: How is insolvency established? A: Insolvency is established when the partnership obtains a certificate signed by auditors stating that in accordance with the Insolvency Act 1986, the partnership will be unable to meet its debts as they fall due. Additional capital or other contributions which might be called upon from personal assets of the partners, are not taken into account. Q: Can we tell Third Parties that we have a Pro-Tect policy? A: No. The existence of a Pro-Tect policy must not be disclosed to any Third Party without permission of ACE European Markets. Q: Is there a requirement to purchase a minimum limit of indemnity under the practice s professional indemnity programme? A: Yes. The partnership must maintain a minimum limit of indemnity of 5 million. Q: If I am a sole practitioner, can my dependants purchase Pro-Tect? A: Yes Q: Will claims arising from work undertaken by partners and employees who have joined the firm after the inception of Pro-Tect be covered? A: Yes. Such claims are covered, as are claims relating to prior practices notified in the application. Successor practices acquired during the period of insurance will need to be agreed by insurers.
9 07 08 Q: If I have a professional indemnity claim against me now or have had one in the past, will it be covered by Pro-Tect? A: No. Pro-Tect will not cover any claims against the firm or any partner of the firm arising out of (i) claims (ii) threatened claims or (iii) circumstances which may or are likely to give rise to claims which have been notified to any insurer prior to the inception of Pro-Tect. All new claims from inception of Pro-Tect arising out of past matters are, however, covered. Q: Do all partners in the partnership need to have their dependants buy Pro-Tect? A: No, however, premiums will be subject to minimums and it may be advantageous for all partners dependants to contribute towards the total premium. Q: Will lateral hires who become principals of the partnership be covered? A: Yes. Any new partners and their dependants will need to be added to the schedule of insureds maintained by the distribution agent which can be amended without the insurer s consent. Q: Is Pro-Tect exclusive to Lockton s Professions team? A: Yes. Pro-Tect can only be arranged through Professions.
10 PRO-TECT - PROTECTION FOR PARTNER S DEPENDANTS About Lockton Lockton is the largest independent, privately owned, global insurance broker and employs more than 4,950 people. Lockton delivers services throughout the world to businesses of all sizes, as well as individual clients. It was founded by Jack Lockton in Kansas City, Missouri, USA, in 1966 and from a modest, home-based insurance agency, has become one of the largest insurance brokers in the world. Professions is a division of Lockton Companies International Limited. Professions is one of the UK s largest professional indemnity (PI) insurance brokers and is a long established Lloyd s insurance broker providing risk management advice and arranging PI insurance cover for clients. Specialist teams handle professional indemnity for solicitors, insurance brokers and construction professionals through to medical malpractice. We aim to provide competitive premiums, extensive cover and innovative solutions to PI planning. Our specialist knowledge and access to a range of markets means we are able to offer a broad choice of products and advice on key professional indemnity issues, including: Primary professional indemnity insurance Excess layer insurance Deductible or Infill insurance. In addition to these areas we can offer advice and guidance on the following: Risk management After the event insurance General commercial combined Financial services Captive arrangements Alternative risk financing.
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12 PRO-TECT - PROTECTION FOR PARTNER S DEPENDANTS About ACE ACE Limited is the Bermuda-based holding company of the ACE Group of Companies, one of the world s leading providers of insurance and reinsurance. Established in 1985 by a consortium of 34 Fortune 500 companies to provide hard-to-find excess liability coverage, ACE was described by Institutional Investor magazine as the biggest event in the insurance business since the Great Chicago Fire. Twenty years later, the ACE Group of Companies is one of a very few truly global commercial property and casualty insurance companies, with offices in more than 50 countries and jurisdictions, and correspondents in some 90 more. Trading on the New York Stock Exchange under the ticker symbol ACE, the company is covered by most of Wall Street s major securities houses. With assets of $49 billion, ACE is a component of the S&P 500 stock index. While ACE is only 20 years old, the company is not without a rich heritage, as a result of their acquisition of CIGNA s global property and casualty operations in 1999.
13 ACE traces its history back to 1792, when the Insurance Company of North America (INA) issued its first coverage on a shipment from the United States to Ireland
14 PRO-TECT - PROTECTION FOR PARTNER S DEPENDANTS Notes
15 contact For further details on Pro-Tect please contact: +44 (0)
16 Our Mission To be the worldwide value and service leader in insurance brokerage and risk management Our Goal To be the best place to do business and to work ACE European Markets Insurance Limited. Authorised and Regulated by the Irish Financial Regulator. Lockton Companies LLP. Authorised and regulated by the Financial Conduct Authority. A Lloyd s broker Registered in England & Wales at The St Botolph Building, 138 Houndsditch, London, EC3A 7AG. Company No. OC LLP Jul 13
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