1. abcd General Insurance Spring Seminar 19-20 May 2003 Scarman House

2. Introduction nThe Thomas Miller Group Private company founded in 1885 n Managers of mutual insurance companies; originally limited to international transport sector n The management services - underwriting, claims handling, investments, regulatory requirements

3. Introduction n The Professional Indemnity Market in the mid 1980’s n An impulse to protect the public n Shrinking capacity and escalating rates n Mutual insurance companies as a solution

4. Introduction nThe attractions of mutuality n Moderate rates – no outside shareholders n A sympathetic insurer n An informed insurer

5. Introduction nThe expansion of Thomas Miller’s business to the professions n Solicitors’ mutual (1986) n Architects’ mutual (1987) n Barristers’ mutual (1988) n Patent Agents’ mutual (1989) n Occupational Pensions Defence Union (1997) n Thomas Miller Litigation Management Ltd (2002)

6. Nature of my address n An examination of professional negligence claims from an insurer’s perspective n Not a lecture on the law of professional negligence

7. The basic law: the core ingredients of a professional negligence claim nIn Contract n A breach of contract - s.13 Supply of Goods & Services Act 1982 nIn Tort n The existence of a duty of care n Breach of the duty of care n The breach of duty causes loss n The loss is recoverable in law

8. The course of a professional negligence claim nThe Unhappy client n Dissatisfaction at the service provided n The client feels that it has suffered financial harm n The client requests an explanation n Notifying the insurance company n the dangers of acting alone n the dangers of being penalised by the insurers for not notifying circumstances that could give rise to a claim n an early run at the insurance policy n adequacy of cover

9. The course of a professional negligence claim nThe client puts the claim on a more formal footing n Solicitors are instructed n The letter before action (pre-action letter under the protocol) n Proceedings n Claimant’s Part 36 Offer

10. The course of a professional negligence claim nReaction to the claim n Fight or settle? n Investigating the merits of the allegations (documentary evidence and potential witnesses) n Is the claim out of time?

11. The course of a professional negligence claim nThe decision is to settle the claim n Settlement negotiations n Mediation n Making a Part 36 Offer / payment into court

12. The course of a professional negligence claim nThe decision is to fight the claim n Preliminary considerations n Appreciating the financial cost n Appreciating the call on management time and disruption to the business n The impact on individuals n The potential publicity n The risks of litigation

13. The course of a professional negligence claim nThe decision is to fight the claim n Preparing the defence n On breach of duty n On causation n On loss n On the quantum of damages

14. The course of a professional negligence claim n Tactics for the defence n Putting up a road block n Applying for summary judgment n Applying to strike out the case n Applying for a trial of a preliminary issue on a point of law or a question of fact n Taking the wind out of the claimant’s sails n Applying for security for costs n Applying for a separate trial of liability and quantum n Blaming somebody else n Seeking an indemnity or a contribution from a third party

15. Reducing the risk of claims nIn relation to the duty of care n Restricting the parties to whom a duty of care is owed n Limiting the scope of the duty of care n Exclusion clauses

16. Reducing the risk of claims nIn relation to the standard of care n The need to be careful n Importance of written records n Continuing professional education

17. Reducing the risk of claims nLimited resources n The level of cover n Limited liability partnerships