In the case in question, the issue turned on whether Mr Brown’s professional indemnity insurers (Zurich Professional Limited) were liable to compensate him after he had been sued by the newly appointed personal representative of two estates for which Mr Brown had previously been the representative.
Mr Brown did not contest the action brought against him and judgement was given in favour of the estates by default. But he did contest Zurich’s refusal to cover his professional indemnity insurance claim. However, the court ruled against him on the grounds that the policy in question only covered Mr Brown whilst acting in his capacity as a solicitor. And there was no evidence to suggest that in his earlier dealings with the estates he had been offering private legal services; rather, he had been acting solely as a personal representative.
In other words, as the ruling made clear, although most professional indemnity insurance policies do provide cover on a ‘claims made’ basis, they only provide cover in relation to the specific professional activity detailed in the insured’s proposal.
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