FPA contingent heads to UK to broker PI insurance deal

Thechief executive of theFinancial Planning Association(FPA), Ken Breakspear, flew to London last week in the hope of clinching a deal to set up the association’s own in-house professional indemnity (PI) insurance scheme.

Breakspear made the trip to meet with representatives of the underwriting group proposing the scheme, after an earlier meeting of the FPA’s board resolved to pursue the proposal further.

The scheme would see the FPA set up a single master policy to cover all its principal members.

Sources say the proposal was well regarded by the FPA board, but that significant questions remained to be put to the underwriter, prompting Breakspear’s trip to the UK.

The underwriter has not been named by the FPA.

The FPA’s goal is to have the scheme up and running as soon as possible to coincide with the next major group PI renewal period for financial planners in March.

The scheme could take the heat out of the PI insurance crisis, which has dogged the financial planning industry in recent times.

Over the last year, the number of insurers willing to cover financial planners for PI has fallen dramatically to number just a handful, resulting in escalating premiums for advisers whose cover has come up for renewal.

The scheme being investigated was chosen ahead of a list of others put forward by a range of underwriters for consideration by the FPA’s PI Taskforce.

The chairman of the taskforce, Melbourne based adviser John Hewison, also accompanied Breakspear to the UK last week.

It is understood the scheme, if adopted by the FPA, would offer largely unrestricted PI cover to FPA members.

Breakspear was due back in the country asMoney Managementwent to print last Friday.