Our PI insurer recently reminded me of an important point: it is useful that PI cover comes as part of an AR package but that does not mean that the broker can otherwise forget about it.
PI works on a 'claims made' basis. This means if a client makes a claim on the broker's PI insurance in respect of business conducted in the past, the claim will only be picked up by insurers if there is PI cover in force at the time the claim is made – any cover that may have been in place at the time the business was conducted is irrelevant.
As far as I am aware, the PI cover provided to ARs will exclude business conducted prior to appointment. So if a new AR cancels his PI he will have no cover in respect of claims arising from business conducted before joining.
Brokers becoming ARs should speak to their current provider about 'run-off' cover. This is cover at a reduced rate to protect brokers who no longer need PI cover from that source but need to retain a degree of cover in respect of past business.
Protexx Mortgage and Financial Services