Workers Comp Insurance Fraud: Business Situations, Injuries, Medical Claims and the Unlawful

It is against this backdrop that in April this year the Royal Yachting Association (RYA) announced changes to the insurance requirements for their approved training centres: Public Liability (PL) to be increased to a minimum indemnity limit of £3,000,000 and, of greater interest, Approved Centres would need to carry £500,000 of Professional Indemnity (PI) cover in respect of their training activities.

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Prima Facie this appeared to be a sensible move. First and foremost, although a trend of "indemnity creep" has seen PL limits nudge upwards in the last few years, a PL limit of £3,000,000 is currently seen as the sensible minimum to carry. Secondly, professional services, including "advice", are specifically excluded under normal PL Insurance wordings (including marine leisure policies) where it is provided for a fee and, obviously, where training is being delivered for a fee, one would expect some advice to be imparted by an instructor. Training and advice, therefore, is normally insured on a PI policy which is why the new requirement appeared to be a sensible move.

One can only speculate how the announcement of the new requirements was received by training centres - particularly the grass roots not-for-profit sailing clubs for whom every pound counts. An uplift in PL Insurance to a £3m limit would probably not break the bank but PI might, perhaps, be a different matter altogether. Firstly, PI in the Marine Sector can be expensive, even for relatively low limits of cover due to a limited Market appetite. Secondly, where children and/or vulnerable adults are involved in activities, the Market appetite diminishes even more creating further scarcity that could lead to even higher prices.

If the clubs received the news less than enthusiastically, one wonders how certain insurers and insurance brokers might have reacted at the prospect of what appeared to be something of a game changer being announced - for precisely the same reasons as above. Insurers because PI is an anathema to many of them and, brokers, because accessing a market prepared to offer palatable rates in return for the required scope of cover would not be easy.