<< Talks

The Avoidance Of Professional Indemnity Claims Through Better Business Practice
Ewan A MacGregor

Guidance Notes
o 1992, 1997 'What' went wrong
o 2002 'Why' things went wrong

Griffiths & Armour Research
o Pilot Study
o Questionnaire
o Workshop
o Guidance Note

What is a Risk?
o Any adverse effect on a stated objective
o Company wide
o Project specific

What is Risk Management?
o Identifying the hazard
o Quantifying the possible harm
o Minimising the probability [likelihood] of the harm being realised

'Risk' is defined to be the probability of the harm being realised but in reality it is the perception of the probability and the extent of harm caused

Insurer's Perspective
o They don't see the hazards, only the harm caused.
o They have no means to minimise the probability of the harm being realised.
o The risks lie not only in performance but also in what is in the appointment

Identifying the Risks
o Client's financial standing
o Level of fees
o Scope of Services
o Contractual liabilities
o Performance

Quantifying the Potential Harm
UNLIMITED UNLESS ….
Contractual Limits of Liability
o Event
o Class of people
o Financial limit

Minimising the Likelihood
[the Research]
o Quality Management
o Ownership of risk management at board level
o Review of submissions for work and Appointments
o Understanding client objectives
o Design variations
o Staff Development
o Communication

Conclusion
o Sharing of best practice
o Strong, committed leadership and culture
o Good communication, internally and externally
o Thorough application of Quality Management
o PI is for the unfortunate, not the careless