Hiscox Professional Indemnity Insurance UK: Review and Cost Guide

What Hiscox professional indemnity covers

Professional indemnity insurance, often abbreviated to PI, responds when a client alleges that a professional service, piece of advice or work was negligent and caused them financial loss. Hiscox writes this cover for a broad range of professions, with particular emphasis on consultants, IT and technology firms, marketing and creative agencies, accountants, and other advisory businesses. The cover typically pays both the legal defence costs of contesting an allegation and any damages or settlement that becomes payable.

The scope extends beyond outright negligence in many wordings. Cover can respond to claims involving breach of professional duty, errors and omissions, defamation arising from work, breach of confidentiality, and loss of documents or data entrusted to the firm. For technology and creative businesses, intellectual property infringement and similar exposures can also be addressed depending on the policy. The precise terms are set by the wording and schedule, so the limit of indemnity and the list of covered perils should be checked against the contracts the business signs.

Many client contracts and professional bodies now require a minimum level of PI cover, and some sectors are obliged to hold it. The limit of indemnity chosen should reflect both these contractual requirements and the realistic scale of a claim the business could face.

How claims-made cover works

A defining feature of professional indemnity is that it is written on a claims-made basis. This means the policy that must respond to a claim is the one in force at the moment the claim is made or the circumstance is notified, not the policy in force when the original work was carried out. The practical consequence is that continuity of cover matters enormously.

If a firm lets its PI policy lapse, a claim arriving after the lapse may not be covered even though the work was done while a policy was active. For the same reason, when a business stops trading it often needs run-off cover, which keeps a claims-made policy responsive to claims that arrive after activities have ceased. Hiscox, like other PI insurers, offers run-off arrangements for this scenario. Understanding the retroactive date in the policy is also important, since work done before that date may fall outside cover.

What Hiscox professional indemnity does not cover

PI cover is bounded by the declared business activities, so work outside the description given at purchase may not be covered. Deliberate, dishonest or fraudulent acts are excluded, as are known circumstances that existed before the policy began and were not disclosed. Liabilities the business assumed voluntarily under contract, beyond what the general law would impose, are commonly excluded or limited.

PI does not act as public liability cover for third-party injury or property damage, nor does it cover the firm's own first-party losses such as damage to its premises. Bodily injury and property damage generally sit with public or employers liability instead. Fines, penalties and certain regulatory sanctions are typically outside the scope. As ever, the schedule will define excesses, inner limits and any conditions, and reading it carefully avoids surprises at claim time.

What Hiscox professional indemnity costs

The premium for PI cover is rated on the individual risk rather than offered at a flat rate. The main factors are the profession or activity, the limit of indemnity, annual fee income or turnover, claims history, and the retroactive period required. Higher-risk advisory work and larger limits push the premium up, while a clean claims record and a modest limit reduce it.

Hiscox generally competes on specialism and the breadth of its wording rather than on being the cheapest provider. When comparing quotes, businesses should look past the headline figure to the limit, the excess and the precise definitions, because a lower price can reflect narrower cover. The cost of an uninsured professional claim, including defence costs alone, can dwarf the annual premium, which is why limit selection deserves careful thought.

• Profession and declared activities
• Limit of indemnity selected
• Annual fee income or turnover
• Claims and incident history
• Retroactive date and run-off needs

How Hiscox performs on complaints

Where a policyholder disputes a decision and cannot resolve it directly, eligible businesses and individuals can escalate to the Financial Ombudsman Service. The FOS publishes complaint volumes and uphold rates by firm twice a year, and these are the figures to consult for a current view of how any insurer handles disputes. General insurance uphold rates commonly fall in the 30 to 40 percent range sector-wide according to FOS, though this varies by product and firm.

For professional indemnity specifically, disputes can be more complex than consumer lines because they often turn on the interpretation of wording, retroactive dates and notification timing. Anyone weighing Hiscox should look up its latest published complaint data at financial-ombudsman.org.uk rather than rely on a single number, since trends over time are more informative than any one period.

Is Hiscox FCA authorised

Hiscox is an FCA-authorised insurer operating within the UK regulatory framework. The definitive way to confirm this is to search the FCA register at fca.org.uk/register, which lists the permissions a firm holds and confirms whether authorisation is current. This review does not quote a reference number, because the register is the live and authoritative source and any figure copied elsewhere can become outdated.

Authorisation places the firm within the FOS and Financial Services Compensation Scheme frameworks and subjects it to conduct rules on fair treatment and clear communication. For professional indemnity buyers, that regulatory backdrop is part of the assurance the cover provides.

Frequently asked questions

What does professional indemnity insurance actually pay for?

It typically covers both the legal defence costs of contesting an allegation that professional work was negligent, and any damages or settlement that becomes payable. The exact perils depend on the wording, which may also cover errors and omissions, breach of duty and loss of documents.

Why is professional indemnity written on a claims-made basis?

Claims-made means the policy responding to a claim is the one in force when the claim is made, not when the work was done. This is standard for PI because professional claims can surface years after the original work, so insurers price and respond based on the current policy period.

Do I need run-off cover with Hiscox if I close my business?

Because PI is claims-made, a claim arriving after a business stops trading would not be covered by a lapsed policy. Run-off cover keeps the policy responsive to claims that arrive after activities cease, and Hiscox offers such arrangements. Whether it is needed depends on the firm's exposure and how long claims could realistically arrive.

How is the cost of Hiscox professional indemnity calculated?

The premium is rated on the individual risk, drawing on the profession, the limit of indemnity, fee income or turnover, claims history and the retroactive period required. There is no flat rate, so two firms in the same trade can pay very different amounts.

What if Hiscox declines a professional indemnity claim?

Raise a formal complaint with the insurer first and let it respond. If unresolved and the business qualifies as an eligible complainant, the matter can be referred to the Financial Ombudsman Service for a free independent review. Eligibility and the process are set out at financial-ombudsman.org.uk.