The following exchange took place on the online forum at ajplus. co. uk.
Where necessary, it has been edited for reasons of space and clarity The RIBA and the Independent Insurance debacle Have you been caught up in the fiasco over the collapse of Independent Insurance? Have you been able to obtain competitive replacement cover, or is your broker taking the first quote, no matter what the cost? Is the RIBA really doing enough?
Ian McGregor See RIBANet Conference (access via www. architecture. com) to see what the RIBA is doing.
Keith Snook, RIBA director of practice Ifthe RIBA has some information/clarification why does it not give it to us? This response by Snook is of no use if you are not RIBA registered because you can't get into the RIBA website.
Ordinary architects - registered and chartered - are experiencing serious problems with this insurance debacle, and it ill behoves Snook to keep whatever information he has to himself.
If the RIBA is indeed 'doing something about it', then surely it is in the interest of the RIBA to crow about it, and in the spirit of Egan, not to be introspective and protectionist with it. Is this some kind of moral pressure to get architects to sign up to the RIBA club?
Name and address supplied The AJ has gathered information from the RIBA website and pasted it on the AJ online discussion forum. Here we include the latest response from the RIBA:
Following further discussions with RIBA Insurance Agency, the RIBA's director of practice, Keith Snook has issued the following statement to clarify the arrangements for cancelling PII policies with failed insurer Independent Insurance.
The professional indemnity policies issued by RIBA Insurance Agency do not contain a cancellation clause in favour of Independent Insurance. In the absence of such a clause in policy documentation, the Independent's provisional liquidators cannot simply cancel policies. Instead they are asking policyholders to cancel on 'mutually agreeable terms'.
Independent Insurance will agree to cancel policies from any date after 18 June 2001, but will expect a pro rata proportion of the pre! mium. In cases where there has been notification of a claim, Independent Insurance will insist upon receiving the full annual premium, in accordance with policy terms.
Where premiums have already been paid to Independent Insurance, the policyholder becomes an unsecured creditor for the amount of any premium being reclaimed.
If the practice is a partnership comprising individuals alone, cancellation of a policy will have the effect of forfeiting any right to compensation from the Policyholders Protection Board in respect of matters arising after the cancellation. It should also be noted that replacement cover may not be identical to that provided by Independent Insurance. For instance, the excess applicable to claims may be higher under a new policy. For some practices, therefore, there may be merit in keeping coverage in force.
The RIBA Insurance Agency will only approach Independent Insurance for its agreement to cancel a policy upon receipt of a written instruction from policyholders or their agents.
Policyholders need to weigh up the benefits of seeking a return of premium as an unsecured creditor, which may produce a very limited payment and which may be delayed for a year or more, against retaining some fallback cover through the Policyholders Protection Board, which is likely to be limited to 90 per cent of a claim at most.
The RIBA Insurance Agency stresses that individual policyholders need to assess their own positions with regard to cancellation. To date, the agency has been concentrating its efforts on quoting for replacement policies. Once this process is completed, it will start processing the cancellation requests.
What are the benefits of partnering?
I am conducting a survey among the client sector on the validity of the Egan report's recommendations.
Except for the few large client organisations (with interests in controlling costs all the way down the supply chain) that can command such long-term relationships, there are others that are very sceptical about the benefits. For some organisations, the partnered approach may not be as beneficial as one might expect.
If you have had positive or negative experiences of partnering relationships or have strong thoughts on the subject, I would be very keen to find out more.
Benjamin Lesser Please address responses to the discussion forum at ajplus. co. uk