Obviously concerned that I had refused to reveal details of my professional indemnity insurance (pii) (renewal date, limit of cover and level of excess) in response to the arb's recent survey, the acting registrar has sent me a letter from which, due to its relevance to our profession, I quote:
... I note your comments concerning confidentiality in respect of the professional indemnity insurance but would confirm that your underwriters would allow this to be disclosed to your regulator ... insurers appreciate that such matters have to be disclosed. Their concern would be disclosure to clients unnecessarily ...
This letter raises a point of great importance to all PII policy holders because by stating that 'underwriters would allow this to be disclosed', the acting registrar is seriously mistaken: I had already discussed this matter with my insurers and they had expressly instructed me not to give such details to the arb. Furthermore, they were seriously concerned that such advice had been given by the board!
Insurance companies are understandably wary about revealing pii details to clients or, more to the point, clients' solicitors, and they will draw no comfort from the acting registrar's implied willingness to disclose such information to clients in circumstances of alleged necessity. Who, for example, at arb could reliably decide what criteria constitute necessity? And anyway, why should we assume that the arb can be trusted not to routinely and indiscriminately release our pii information whenever requested? It has already shown itself to be indiscreet in investigating allegations against architects.
Architects carry heavy professional responsibilities and, in our increasingly litigious society, solicitors acting for potential plaintiffs show little restraint in exploiting our professional accountability. They are often 'trigger happy' in their desire to make fat fees by encouraging unwarranted claim actions.
Solicitors know that litigation is now so expensive that some insurance companies can be pushed towards settlements simply to defray mounting legal costs, even when the architect's performance was sound. Provide such legal teams with the kind of pii details that the arb are now requesting and you furnish claimants with valuable information which informs their strategy in any claim against you.
Also, if you are joined in matters pertaining to other consultants, or to main contractors, sub-contractors or suppliers, your pii information is invaluable, and may cause litigants to re-direct claims principally towards you - especially where others are uninsured, underinsured or have ceased to trade. That is why your insurers require the details of your cover to remain strictly confidential throughout any dispute.
Make no mistake - your pii company has contracted with you - not your client and not the arb. You have obligations to it under that contract which include allowing them to manage the defence of any claim against you. If you breech the terms of your policy, cover may be withdrawn which is hardly in the interest of your client.
The arb Code, albeit much discredited, requires under Standard 7 that an architect 'should not undertake professional work without adequate and appropriate professional indemnity insurance cover'. Don't misunderstand that should, for despite the code's preamble that it 'has not been drafted in legal language', the previous registrar assured me that should in this context carries its full legal interpretation - which is must.
So, yes, make sure you have pii - you should have done that anyway. If requested, confirm to the arb that you have complied with Standard 7, but keep all details of your insurer's identity (extent of cover etc) confidential. And think about it: if the arb doesn't intend to release details of your pii cover to your clients, then logically it doesn't need them anyway!
Conversely, if the arb will, as the registrar's letter suggests, willingly pass on such information in circumstances where it deems such action warranted, you have everything to lose, and your pii company may well hold you responsible for any adverse consequences. You have been warned ...