OPTIONS FOR PROFESSIONAL INDEMNITY COVER WITH EFFECT FOR THE YEAR 01 JULY 2011 TO 30 JUNE 2012

The Attorneys Fidelity Fund Professional Indemnity Insurance Scheme affords a certain level of free professional indemnity cover to all attorneys practising in South Africa in terms of the Attorneys Act 53 of 1979 (as amended).

The details of the cover are contained in an annually renewable policy document, which comes into force on 01 July of each year and expires on 30 June of the following year. (Click here to Download)

The limits of indemnity and deductibles (excesses) are determined by the number of partners that constitute the insured practice on the date that the alleged cause of action arose, in accordance with the schedule to the applicable policy document.

A number of practitioners have expressed the concern that the existing deductibles are high particularly in respect of practitioners who are not at risk for claims which are likely to require high levels of professional indemnity cover.

If you have similar concerns, please download a letter containing more information regarding the options, and an application form.

OTHER INSURANCE OPTIONS TO CONSIDER

Should you wish to increase rather than reduce your limit of indemnity, then you would need to contact a reputable broker to advise you on and arrange so-called “top-up” cover for your firm.

Your attention is specifically drawn to clause 5.1. of the scheme policy read with clause 5.1.5 (Policy Document) All claims arising out of the theft of trust money are excluded from cover.

One of the most common misconceptions held by practitioners, is that they themselves enjoy indemnity through the AFF for their/their staff’s misappropriation of trust money. The Fidelity Fund is a fund of last resort, which means that a claimant first needs to exhaust all remedies against the partners/directors of the practice before the Fund comes to its assistance.

It is therefore essential that all practitioners with trust accounts carefully consider the risks of failing to buy cover for misappropriation of trust money through a broker on the open market.