0. PROFESSIONAL INDEMNITY INSURANCE COUNCIL OF ENGINEERS JANUARY 22, 2014

1. AGENDA
 INTRODUCTION
 Lockton Wattana Insurance Brokers (Thailand) Ltd.
 RISKS MANAGEMENT
PROFESSIONAL INDEMNITY
 COVERAGE / DEFINITION / EXTENSION / EXCLUSION
 STANDARD PREMIUM PRACTICE
 MARKET
 PROCESS OF BUYING POLICY
 CLAIM EXAMPLES & PROCESS
 INSURANCE PARTNERS

2. Lockton Wattana Insurance Brokers (Thailand) Ltd.
Established in 1984
In 1986, entered into a joint venture with Citicorp Insurance Group and become part of management buyout by Nelson Hurst International Group in 1991
In 1997, Price Forbes Group acquired Nelson Hurst, and renamed as Alexander Forbes Wattana Co., Ltd.
End of 2006, buyout of International Operation by Lockton Group, we became Lockton Wattana Insurance Brokers (Thailand) Ltd.
Ranking – Top ten of the world, top three in Thailand
Over 140 offices in 44 countries.
Office in Thailand – approximate. 230 staffs
Outstanding Non-Life Insurance Broker for the year 2008, 2009, 2010, 2011 and 2012

3. Lockton Wattana Insurance Brokers (Thailand) Ltd.
Insurance Services
Property All Risks - Marine Cargo / Inland Transit
Business Interruption - Personal Accident
Public Liability - Health
Motor - Travel
Contractors’ All Risks - Directors’ & Officers’ Liability
Fidelity Guarantee - Professional Indemnity/ Professional Liability
Money - Trade Credit

4. RISKS MANAGEMENT – MIX STRATEGY
Level Of Risk
Transferred Risk
(Insurance)
Reduced Risk
(Safety Measures)
Avoided Risk
Retained Risk

5. PROFESSIONAL INDEMNITY INSURANCE (PI)
To indemnify the insured against legal liability for any claim first made against them during the period of insurance.
Arising from Wrongful Act (i.e. negligent act or error & omission) in the conduct of the Professional Services practice carried on by the insured.
Professional Indemnity Policy would provide cover for:-
 compensation, and/or damages awarded against professional
 legal costs and other expenses associated with defending
legal actions (subject to consent of the insurer).

6. DEFINITIONS
Wrongful Act shall mean any error, misstatement, misleading statement, act, omission, neglect or breach of duty committed, attempted or allegedly committed or attempted, by an Insured while performing or failing to perform Professional Services.
Professional Services shall mean services performed by an Insured solely in its capacity as their Business Practice for or on behalf of a customer of the Insured.
Business Practice shall mean the business conducted by the Insured, as specified in the Schedule.

7. CLAIM MADE BASIS
Claims made basis shall apply only to wrongful acts which happen, and for which claim is made against the Insured, while the insurance is in force.
Claim Made
16/11/2013
Wrongful Act
15/5/2012
Retroactive Date
1/1/2011
1st Policy
2nd Policy
3rd Policy
2011
2012
2013
2014
Claim first made on 16/11/2013, Wrongful act happen on 15/5/2012

8. PROFESSIONAL INDEMNITY INSURANCE (PI)
Policy schedule
Limit of policy, Up to client, Normally Limit ~ USD 1 M – USD 20 M
Deductible, ~ > USD 10,000
Premium, ~ > USD 7,000
Type of Policies
1. Annual Policy
- For all activities of the Insured and shall renew every year.
2. Single Project Policy
- For Specific activity with period more than 1 year. Generally up to 10 Years.
3. Excess Layer Placement
- In case of Higher Limit, we could use Local Insurance as Primary Layer and use International Reinsurer as Excess Layer

9. POLICY EXTENSION Libel and Slander - Estates and Legal Representatives
- Project Management
- Outgoing Principals
- Loss of Documents
Intellectual Property
Joint Venture Liability
Consultants, Subcontractors and Agents
Run-off Cover Insured Entity or Subsidiary
- Estates and Legal Representatives
- Acquired Entity or Subsidiary
Fraud and Dishonesty (Optional)
Increased Aggregate Limit of Indemnity
(Optional)

10. STANDARD EXCLUSION Prior or Pending Claim - Supply of Goods
Known Claim & Known Circumstance
- Fraud and Dishonesty
- Assumed Duty or Obligation
- Related or Associated Entities
Fines and Penalties
Punitive Damage
Nuclear
- Supply of Goods
- War & Terrorism
- Absolute Asbestos
- Previous Business
- Bribe & Illegal Payment

11. STANDARD PREMIUM PRACTICE
Business Type
Annual Report &
Overall business
Experience &
Qualification
Claim
History
Limit of liability
Deductible

12. PROFESSIONAL INDEMNITY INSURANCE (PI)
Market Capacity
LOCAL CAPACITY
 USD 5 M – USD 20 M
INTERNATIONAL CAPACITY
 USD 10 M – USD 30 M
Example Of Local Capacity
QBE
AIG
ACE
Non Preferable Risk
* Geotechnical / Soil
* Environment Engineering
* Nuclear Engineering
* Mining Engineering
* Chemical Engineering
* Aeronautical / Space Engineering
* Marine / Naval Engineering
* Offshore Platform Engineering
Limit of Capacity
USD 20 M
USD 5 M – 10 M
USD 10 M
Single Project Period
7 Years
> 10 Years
1.5 Years

13. PROCESS OF BUYING POLICY
Client
Insured complete Application Form submit to LOCKTON.
LOCKTON approach the markets for insurance terms.
LOCKTON return Quotations with suggestion to Insured.
Insured select the prefer one, then receive Policy from LOCKTON while LOCKTON continue support for any claims that may occur.
Application
Policy
LOCKTON
Insurers
Insurer
Insurer
Insurer

14. ROLE OF INSURANCE BROKER
To work for insurance related issues on your behalf
To assist you in buying insurance and not selling
To analyze and survey of your insurance needs and arrange the insurance which most suits to your exposure.
Market with underwriters different appetites and capacities.
To clarify and discuss with you to choose the appropriate insurance program
To handle and manage the claim until the claim is finally settled

15. CLAIM EXAMPLES
CLAIM INVESTIGATION
What actually happened?
What went wrong?
Why did it go wrong?
Was the Insured or one of their employees responsible for what went wrong?
Is the loss covered by the policy?
Are the Insured’s business activities correctly described in the policy schedule?
Was the loss notified in accordance with the requirements of the policy?
Royal Plaza Hotel at Nakhonratsima collapsed on 13th August 1993
137 people died
Renovated from 3 storeys building to 6 storeys due to boom business

16. CLAIM EXAMPLES
CLAIM INVESTIGATION
What actually happened?
What went wrong?
Why did it go wrong?
Was the Insured or one of their employees responsible for what went wrong?
Is the loss covered by the policy?
Are the Insured’s business activities correctly described in the policy schedule?
Was the loss notified in accordance with the requirements of the policy?
Burapha University, Chonburi, 2nd Flooring collapsed on 15th August 2010
One dead and four got injured

17. CLAIM EXAMPLES
CLAIM INVESTIGATION
What actually happened?
What went wrong?
Why did it go wrong?
Was the Insured or one of their employees responsible for what went wrong?
Is the loss covered by the policy?
Are the Insured’s business activities correctly described in the policy schedule?
Was the loss notified in accordance with the requirements of the policy?
7 Storeys, 77 Rooms Apartment at Kukot, Lamlukka leaned in 2013
Had to demolish

18. CLAIM EXAMPLES
CLAIM INVESTIGATION
What actually happened? Concrete Beam Cracked
What went wrong? Incorrect Design
Why did it go wrong? Loading calculation error
Was the Insured or one of their employees responsible for what went wrong? Yes
Is the loss covered by the policy? Yes
Are the Insured’s business activities correctly described in the policy schedule? Yes
Was the loss notified in accordance with the requirements of the policy? Yes
6 Storeys Shopping Complex at Samutprakarn, Concrete Beam Cracked in 2013
Rectification Cost approx 6mb

19. CLAIM PROCESS Claim First Made Pay Defense, Investigation CLAIMANT1
Claim First Made 2
CLAIMANT
INSURED
Pay Defense, Investigation
Pay damages, Indemnity
Claim
Consult 4 3
Lockton report claim and
assist Insured to get their Claim.
LOCKTON
INSURANCE

20. STANDARD CLAIM PRACTICE
The Insured must give to LOCKTON a written notice of any Claim first made against the Insured - as soon as practicable and during the Period of Insurance.
Relevant documents :
The date in which the Insured/Company first became aware of the matter, if other than the court summons.
Notice letters and/or demand letter and/or other written correspondence from the claimant etc. (if any).
Other additional documents, if required.
 In case there is a circumstance which the Insured realize that it may lead to a claim in the future, it is required by the Insurer to report such circumstance to reserve the right of claim. LOCKTON may also be able to advise you about whether a situation is a circumstance that should be notified.

21. INSURANCE PARTNER LOCKTON LIU ACCP ACE ACR QBE AIG ZURICH SWISS RE
Generally A
DHIPHAYA
THAISRI
SCCB

22. LOCKTON WATTANA – PI TEAM
Lockton Wattana Insurance Brokers (Thailand) Ltd.
35th Floor, United Centre Building,
323 Silom Road, Khet Bangrak, Bangkok 10500
Tel
• Underwriting:-
Name Ext.
Khun Mingkwan Sirichaiyakul
Khun Viyada Engchuan
Khun Supattaga Kunjara Na Ayudhya 6903
• Claims Department:-
Khun Sakorn Sudsa-ard
Khun Pannapa Thepmahutsilp
Khun Tipprapai Lagum

23. THANK YOU
Q & A