A pension advice firm saw a 35 per cent drop in its personal indemnity insurance (PII) this year, signalling the end of years of rises.
Fiona Tait, technical director of Intelligent Pensions, said the drop in PII premium could be a sign the market is changing and advised others to shop around so that they could also receive better rates.
Tait told FTAdviser that the fall came as a welcome relief after steep rises in previous years and that it looks to be a sign advisers could have the chance to nab better deals when it comes to renewing their insurance.
PII covers firms in case compensation needs to be paid out.
While Tait understands her previous insurer would have offered a slight reduction, she was offered a much better deal by switching to a new provider.
Tait did not want to reveal who her provider was but urged other advisers to see if there were better deals on the market.
She said rising interest rates has had a knock-on effect on cash equivalent transfer values (CETV) for defined benefit redress, which has played a part.
Tait said: “We were told by the brokers that with interest rates as they are, any redress that would have to be put on for DB cases, compensation to the client would be lower. It came with a warning that it might go up again in the future.”
She added: “The basic thing is that there is some movement in the market so it is worth looking around, but make sure the coverage is the same.”
Earlier this month, FTAdviser spoke to Phil Billingham, director of Perceptive Planning who saw his PII premium halve.
He put this down to going the extra mile and giving his insurer, who he has been with for many years, more information than just the application.
This chimes with the approach of Intelligent Pensions. Tait said the company went through a “personalised underwriting process” with several discussions and emails rather than just a proposal form.
tara.o'connor@ft.com
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