How to Make a Professional Indemnity Claim: A Step-by-Step Guide

Finding out a claim has been made against you is stressful. Knowing what to do next makes all the difference.

This guide walks you through the process clearly — from the moment you become aware of a potential claim through to resolution.

Step 1: Don’t ignore early warning signs

A claim doesn’t always start with a formal letter. Often the first signs are subtler:

• A client expresses dissatisfaction with your work
• You receive a complaint, even an informal one
• A client hints they’ve suffered a loss connected to your services
• You become aware of a mistake that could give rise to a claim

At this stage, many professionals hope the issue will go away. It rarely does — and waiting can make things worse.

Step 2: Notify your broker immediately

The single most important thing you can do is tell your broker as soon as you become aware of a potential claim — or even a circumstance that might lead to one.

Most PI policies are written on a “claims made” basis, which means the claim must be notified during the active policy period. Miss that window and you could find yourself without cover, even if the underlying work was carried out while you were insured.

When in doubt, notify. It costs nothing to flag a potential issue, and it protects your position.

Step 3: Don’t admit liability

This is critical. Before speaking to your insurer or instructing lawyers, do not:

• Apologise in a way that could be construed as admitting fault
• Make any offers of compensation to the claimant
• Discuss the merits of the claim directly with the claimant’s legal team

Even a well-intentioned response can be used against you later. Let your broker and insurer guide communications from this point.

Step 4: Gather your documentation

Your broker and insurer will need to understand the background to the claim. Start pulling together:

• The original contract or terms of engagement
• All correspondence with the client — emails, letters, meeting notes
• Any deliverables, reports or advice you provided
• Records of instructions you were given and decisions the client made
• Any internal notes or file records relevant to the work

Step 5: Work with your claims handler

Once notified, your insurer will appoint a claims handler — and if you’re with a broker like Pii Brokers, you’ll also have an in-house team working on your behalf.

Your claims handler will:

• Assess the claim and review your policy coverage
• Liaise with the insurer on your behalf
• Appoint specialist legal representation where needed
• Keep you informed at every stage of the process

A good claims handler doesn’t just process paperwork — they actively fight your corner, challenge unfair positions taken by insurers, and work to get the best possible outcome for you.

Step 6: Understand the process

Every claim is different, but most follow a similar path:

Your claims handler will:

1. Notification — you inform your broker of the claim or circumstance
2. Coverage review — the insurer confirms whether the claim falls within your policy
3. Investigation — evidence is gathered and the merits of the claim are assessed
4. Negotiation or defence — depending on the strength of the claim, your insurer will either negotiate a settlement or defend the case
5. Resolution — the claim is settled, dismissed or concluded at trial

Some claims resolve quickly. Others take longer, particularly where liability is disputed or the sums involved are significant. Your broker should keep you updated throughout.

Step 7: Look after yourself

Claims — even unfounded ones — can take a toll. Having a professional challenge your work is personal, and theprocess can drag on for months.

Lean on your broker. Ask questions. Push for updates if you feel you’re being left in the dark. You are entitled to understand what is happening with your own claim at every stage.

Common mistakes to avoid

• Notifying late – always err on the side of early notification
• Going it alone — never respond to a claimant’s legal team without guidance
• Poor record keeping — good files are your best defence
• Switching insurer mid-claim — talk to your broker before renewing or changing cover if a claim is open or pending
• Assuming it won’t be covered — notify anyway and let the insurer make that determination

What if I disagree with how my insurer is handling the claim?

You have the right to challenge your insurer’s position — and a good broker will do this on your behalf. If your insurer is being unreasonable about coverage, slow to act, or undervaluing a settlement, your broker should be pushing back firmly.

This is one of the most important reasons to use an independent broker rather than buying direct.