Provides indemnity for the cost of claims brought against your company, yourself or your employees when a client or third party alleges you’ve breached your professional duty. The claim may be that you haven’t completed your services satisfactorily, or that there’s been a breach of duty because of a specific act, error or omission.

Professional indemnity insurance also covers the legal costs and expenses for your defence, as well as any damages or costs that are awarded as described above.

You need to have the insurance in place when the problem is identified – this could be several years after the alleged mistake was made.

This policy is aimed at picking up certain of the “residual commercial risks” that may fall outside the scope of Professional Indemnity insurance as a “difference in conditions” to augment the Professional Indemnity cover (e.g. to cover the liability you may have for the “wrongful acts” of the other Trustees and/or other matters that may fall outside the scope of Professional Indemnity Cover).

The Limit of Indemnity available for any one claim and for all claims during the period of insurance is the equivalent of $100,000 per declared Trustee appointment subject to a maximum that is equal to the selected Professional Indemnity Limit of Indemnity.

The Deductible will be the equivalent to that chosen by your practice in the Deductible question in the proposal form, on a “costs inclusive” basis in respect of this Companion policy.

As the result of the High Court decision on 15 September 2011 in the case of Steigrad & Ors v BSFL Limited & Ors (i.e. the Bridgecorp Case) the Court determined what would happen when Directors wanted their Directors’ & Officers’ Liability Policy to pay for their defence costs when, at the same time, the potential plaintiffs wanted the likely proceeds of the insurance set aside in the event they could successfully establish a liability claim against the Directors.

The Court decided that where a claimant had a “charge” over the total insurance money available then the Insurer could not pay the Directors defence costs. A charge can be established under Section 9 of the Law Reform Act 1936. This charge can be created over the sum insured by a liability policy that insures the alleged liability. The Section creates the charge at the date of the alleged wrongdoing and this can be applied retrospectively after the Insured claims for the defence costs.

A problem is created in respect of liability policies that are issued on the basis of a “costs inclusive” Limit of Indemnity. To overcome this problem Abacus has arranged with its Insurers to provide an additional defence costs section in the cover for 20% of the limit of indemnity “corralling” that entitlement to defence costs.
This extended coverage is not intended to apply to any trading trusts, whereby a company is the sole trustee or to appointments to the Board of Trustees of any School. A Board of Trustees for a School is not actually a Trust in the legal sense, being a separate legal entity established by Statute (i.e. the Education Act 1989 which contains certain exemptions from personal liability). If you require clarification in this regard please seek advice from the Abacus Insurance Consultants.

This policy is aimed at picking up certain of the “residual commercial risks” that may fall outside the scope of Professional Indemnity insurance as a “difference in conditions” to augment the Professional Indemnity policy (e.g. to cover the liability you may have for the “wrongful acts” of the other Directors & Officers and/or other matters that may fall outside the scope of Professional Indemnity Insurance).

The Limit of Indemnity available for any one claim and for all claims during the period of insurance is the equivalent of $100,000 per declared director appointment subject to a maximum Limit equal to the amount of Professional Indemnity cover selected.

The Deductible will be the equivalent to that chosen by your practice in the Deductible question in the proposal form, but on a “costs inclusive” basis in respect of this Companion policy.

As the result of the High Court decision on 15 September 2011 in the case of Steigrad & Ors v BSFL Limited & Ors (i.e. the Bridgecorp Case) the Court determined what would happen when Directors wanted their Directors’ & Officers’ Liability Policy to pay for their defence costs when, at the same time, the potential plaintiffs wanted the likely proceeds of the insurance set aside in the event they could successfully establish a liability claim against the Directors.

The Court decided that where a claimant had a “charge” over the total insurance money available then the Insurer could not pay the Directors defence costs. A charge can be established under Section 9 of the Law Reform Act 1936. This charge can be created over the sum insured by a liability policy that insures the alleged liability. The Section creates the charge at the date of the alleged wrongdoing and this can be applied retrospectively after the Insured claims for the defence costs.

A problem is created in respect of liability policies that are issued on the basis of a “costs inclusive” Limit of Indemnity. To overcome this problem Abacus has arranged with its Insurers to provide an additional defence costs section in the cover for 20% of the limit of indemnity “corralling” that entitlement to defence costs.
This extended coverage is not intended to apply to any listed companies. If you require clarification in this regard please seek advice from the Abacus Insurance Consultants.

Statutory Liability Insurance is designed to provide cover to the firm and its principals, officers and employees for defence costs and fines/penalties in respect of unintentional breaches of almost all Acts of the New Zealand Parliament with the exception of the Health & Safety at Work Act where the policy covers defence costs and reparation orders (this Act expressly prohibits insurance against fines and penalties.

Some of the more significant Acts that are included and have particular relevance to Members are:

• The Resource Management Act 1991 and its amendments
• The Building Act 1991 and its amendments
• The Fair Trading Act 1986 and its amendments
• The Consumer Guarantees Act 1994 and its amendments

The insurance in general terms applies only to events neither expected or intended by you, but does not cover any deliberate failure to comply with the statutes or lawful notices, including any prohibition or suspension notices issued under the authorities of the Acts.

Please be wary of any tax liabilities

It is often not appreciated by Accountants that in accepting appointments as Trustees any tax liabilities of the Trust are, in fact, commensurate with the personal tax liabilities of all of the Trustees.

Any statutory demands for payment of taxes, use of money interest or penalties for non-payment are very significant personal risks that are basically uninsurable under Professional Indemnity or any other liability policies (i.e. they are not demands for compensation by a Client in a Civil Court)

The IRD can make its statutory demands against any one or all of the Trustees of a Trust as an example. Accountants should understand that as Trustees, in the event of a Trust having insufficient assets to meet its tax liabilities, they could become personally liable along with the other Trustees for that tax.

This is diametrically opposed to a situation whereby an Accountant has made an accounting error or an error in the provision of any tax advice to or on behalf of a Client and the Client then makes a demand for compensation seeking reimbursement of loss caused by the error.

In this latter situation, such a demand for compensation would constitute a “civil claim” and be the subject of Professional Indemnity Insurance, subject to its terms and conditions.

The Accident Compensation Act 2001 and its amendments provide compulsory statutory coverage for personal injury to employees caused by “accidents”. The Employers Liability Insurance is designed to include the costs of defence and any awards of compensation to employees for personal injuries falling outside of the scope of the Accident Compensation Legislation.

Some of the risk exposures to Employers that may fall outside of the scope of the legislation can be as follows:

• Mental anguish without physical injury
• Stress without physical injury
• The results of passive smoking
• Melanoma
• Food poisoning
• Viruses transmitted through air conditioning
• Exposure to other gradual processes such as OOS. (One month of disability only is covered by the Act)

 

This policy is designed in two sections:

 (i) Legal costs and awards against employers following claims by current, former or prospective employees for breach of employment contracts and breach of certain provisions of the Human Rights Act 1993 and the Privacy Act 1993.
 (ii) Legal costs incurred in the defence of injunctions or applications for reinstatement brought against employers by current, former or prospective employees.

Members should note however that for indemnity to be available under this policy there are requirements for members to give prior notification to the Abacus Insurers of:

• any steps to instigate any disciplinary, demotion or redundancy procedures in respect of any employees; and
•  to follow the Abacus Insurers’ directions in such regard

In conjunction with the other Companion Liability Insurances Abacus has arranged General (Public) Liability Insurance to cover loss as a result of legal liabilities to pay compensation to Third Parties for Personal Injury or Property Damage.

This is quite distinct from any losses arising from a breach of professional duties.

The cover is intended to cater for civil claims arising from "accidents" or "occurrences" in business that can cause either property damage or personal injury to members of the public.

Also included within the protection is an extension for "punitive or exemplary" damages in respect of bodily injury to members of the public.

The main cover provisions include:

• Legal liability to pay compensation in respect of Personal Injury or Property Damage world wide, but excluding liabilities incurred within the USA or Canada or their territories or protectorates.
• Legal Costs and Expenses of defence incurred with the Insurers’ consent.

The automatic extensions include:

• Landlords Liability
• Tenants Liability
• Forests & Rural Fires Act Liability
• Vibration & Removal of Support
• Mechanical Plant
• Goods in Custody or Control
• Motor Vehicle/Watercraft Service & Repair Liability
• Exemplary Damages Liability for Bodily Injury
• Indemnity to Principals, Lessors, Grantors and the like

Some of these extensions are subject to certain sub-limits of indemnity within the basic level of indemnity.

This policy is designed in general terms to provide for emergency legal advice at any time, day or night, and meets legal costs if a Partner, Director or Employee is wrongly sued or charged with a work related criminal offence.

The type of legal defence costs included:

• Offences under any Statute arising in the course of the conduct of the Professional Practice.
• Traffic Offences arising from work related events, except for those that are alcohol or drug related, related to logbooks, overloading, road user charges or speeding including dangerous or excessive speed.

The main exclusions are:

• The Insured person must not have been charged with any similar offence in the 7 years prior to inception of the cover.
• The Insured person must plead not guilty.
• The not guilty plea must be reasonable, based on evidence and the law.
• Legal actions for alleged breach of duty as a director, trustee or the exercise of a power of attorney, but those arising from other professional duties are not excluded.
• Liabilities assumed by agreement.
• Disputes concerning a will, bequest, devise, contract to leave assets in a will, probate, testamentary promises claim, family protection claim, inheritance or gift.
• Employment disputes.
• Domestic legal disputes
• Insured person versus Insured person disputes
• Legal action by state agencies involving state funded grants, income ,revenue collection, income support, aid, subsidy, surcharge or assistance.
• Legal action intentionally encouraged
• Legal action under Fisheries legislation
• Fines penalties or damages.

The Insurer has the right to reclaim the legal expenses in the event the Insured is convicted of one or more offences arising out of the same general circumstances.

This policy will pay legal costs incurred in the defence of personal liability or legal representation in a range of different types of legal proceeding arising from many aspects of home and work life including driving vehicles, occupying homes, carrying out work and participation in leisure and community activities.

Note: For COUPLES the policy covers the person named in the Schedule and his/her named spouse or domestic partner who:

(a) actually and normally resides with him/her on the first date of the policy year; and
(b) still actually and normally resides with him/her at the date of which the legal action commenced.
For FAMILIES the policy covers the person named in the Schedule and every person who is their immediate family that:
(a) actually and normally resides with him/her or temporarily resides elsewhere as a student on the first date of the policy year; and
(b) still actually and normally resides there or is temporarily residing elsewhere as a student at the date of which the legal action commenced.

LawSafe does have its Limits

The purpose of LawSafe is to provide valuable personal legal protection to the widest range of policyholders at an affordable price but there are some things that can’t be covered:

• There is no cover for things that have happened before taking the policy out in the same way as you cannot insure a house after it has burned down.
• We cannot cover people for repeat offences or allegations (recidivism).
• We will not provide cover for disagreements, disputes or conflicts between family members, matrimonial issues, custody and wills.
• The policy only funds reasonable “not guilty” pleas.

Claim Examples

Workplace accusation
A work colleague drums up malicious accusations against you. It's your word against theirs.

Private agreement dispute
You've sold your house. The buyer Is dissatisfied and say’s "I'll see you in court."

Criminal prosecution
Your son or daughter is caught in the wrong place at the wrong time. The police have laid charges.

Health and Safety
You are Involved in a Health and Safety incident at work with serious injury. You are charged and need legal representation.

Neighbourhood dispute
You bring in a builder to put up a fence. Your neighbour brings in a lawyer to get it torn down.

Traffic offence
You're charged with a serious traffic offence and face losing your license.
Social events Your teenager is having a part!:J. Uninvited guests turn up. So do the police.

The Abacus Professional Indemnity Policy does not contain any specific exclusion relative to a loss arising from civil liabilities when providing professional advice or services through use of the Internet or E-Commerce communications.

However, other liabilities and losses can occur for a Member Firm including the transmission of viruses to various other sites, defamation, infringement of intellectual property, breach of copyright, confidentiality, transmission of obscene material and other issues arising from the non-professional or non-work related activities of the Staff with access to the Internet, Electronic mail or any Electronic Network.

Covers your Business Assets including Buildings, Plant Contents & Stock as applicable at specified locations around New Zealand, with the option for cover Anywhere in New Zealand for portable items over $5,000

Standard Excess $500, increasing to $1,000 for Burglary & Theft, $1000 for items such as Optical Equipment, GPS and similar, Landslip and Subsidence $10,000, Natural Disaster where included according to area

Covers accidental damage to owner’s vehicle and liability to third parties ($10 million limit).

Cost of the cover will depend upon the value of your vehicle; your claims history and your locality.

Policy has a standard excess of 1% of the vehicle value subject to a minimum of $500 unless otherwise stated.

Additional excesses apply where a person under 25 drives the vehicle.

No excess will apply for loss or damage by fire, theft or conversion of whole vehicle.

Loss of Use Rental Costs (optional extension). If your vehicle is damaged and you hire a replacement vehicle this extension provides additional cover as a buffer against the rental costs for that vehicle subject to a 7 day excess: Price on application.

Covers accidental damage to owner’s vehicle and liability to third parties ($10 million limit).

Cost of the cover will depend upon the value of your vehicle; your claims history and your locality.

Policy has a standard excess of 1% of the vehicle value subject to a minimum of $500 unless otherwise stated.

Additional excesses apply where a person under 25 drives the vehicle.

No excess will apply for loss or damage by fire, theft or conversion of whole vehicle.

Loss of Use Rental Costs (optional extension). If your vehicle is damaged and you hire a replacement vehicle this extension provides additional cover as a buffer against the rental costs for that vehicle subject to a 7 day excess: Price on application.

• House Insurance.
• Landlords Property One attached to House Insurance
• Contents Insurance
• Private Motor Vehicle insurance with the option of Roadside Assist
• Private Pleasurecraft Insurance
• Rural Lifestyle Insurance
• Rural Insurance
• Travel Insurance
• Marine Insurance
• Contract Works Insurance
• Natural Disaster Buy Down Insurance
• Public Liability Insurance as Property Owner
• Statutory Liability Insurance as Property Owner

• Life Insurance/Health Insurance/Disability - Income Protection/Trauma - Crisis Cover/ Key Person Protection/ Co Shareholder Protection/Employee Benefits (when over 5 staff)
• Kiwi Saver
• Technical Liabilities including Professional Indemnity, Directors and Officers , Internet Liability, Cyber Liability and similar
• Aon Valuation Services
• Aon Sprinkler Services
• For other cover requirements not mentioned here please let us know what you require

Provides a lump sum on the death of the life insured. The policy also pays the death benefit early should you have a terminal illness and a life expectancy of no more than 12 months.

Provides a lump sum if the insured suffers an injury or illness which totally and permanently incapacitates them, preventing them from working again.

Provides a lump sum cash benefit on diagnosis of certain defined major or ‘critical’ medical conditions such as heart attack, stroke, cancer, paraplegia, major organ transplant, etc. There are 43 conditions covered. You do not need to be deemed unable to work to receive this cover.

If you are unable to work in your job for more than 10 hours per week due to a sickness or accident, Income Protection can provide a monthly income of up to 75% of your gross income, plus other benefits to assist. Waiting Periods can be 4, 8 or 13 weeks, and benefits are payable for 2 or 5 years or until age 65 or 70.

The intention of this insurance policy is to provide a lump sum payment to assist with a companies Buy/Sell agreement. In the event of death or total permanent disablement the insurance will provide the necessary funding to allow the other business partner(s) to purchase the deceased or disabled partners shares. This can protect business owners and their estates.

Having a key person like a director,  shareholder or main revenue generator, pass away, fall seriously ill or be seriously injured can have a devastating effect on a business. Key Person Insurance cover will provide a lump sum or monthly  payment to minimise the financial impact on your business and cover lost revenue and recruiting costs.

With Business Expenses Cover, you can keep your business running if you suffer illness or injury. As a sole trader, small business owner or if you’re in a partnership, you can claim the costs of running your business if you are unable to work more than 10 hours a week, and it will pay for a two-year period. The benefit covers fixed expenses up to $25,000 per month.