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Notifying a Claim or Potential Claim

Clause 12 of the 2020 Certificate of Insurance requires that you must immediately notify Marsh of any claim or potential claim made against you but no later than 60 days from the date you first became aware  of (received/served) such claim or potential claim eg claim – upon receipt of any letter/notice of demand or legal proceedings made against you/the firm eg writ, summons, notice of third party action or counter claim etc OR an intimation of an intention to do the same; potential claim or notifiable circumstance – upon your awareness of any fact, circumstance or event which you reasonably anticipate could give rise to a claim against you in the future, eg DB Complaint or you discover a possible error, omission or misconduct.

How to notify Marsh? Send email to mbar@marsh.com which must contain:
·       Subject title: [Firm name] – Notification
·       Contents:
 
We received/became aware of an LOD / writ / summons / counterclaim / third party action / DB Complaint or other circumstance on [date], please see attached.
If applicable: We replied to the LOD or entered appearance / defence or replied to DB on [date], please see attached.
 
Our firm / lawyer acted for [name] who is the [role eg vendor / purchaser etc] in a [transaction / agreement / suit eg SPA, share sale, bankruptcy, probate etc].
 
The Claimant / Potential Claimant is [name] who is the [role eg vendor / purchaser etc] in relation to the said [transaction / agreement / suit].
 
The Claimant’s allegations against us is that: [list down the main allegations].
 
The current status of this matter is [describe the current status eg next court date for case management etc].
 
Our sole proprietor or partner-in-charge of this matter is [name, mobile phone number & email address].
 
Note: Please attach all documents mentioned above.
 
 
IMPORTANT:
  • Do not admit liability or negotiate any kind of settlement or compromise or incur any unreasonable expenses on the notification without the Insurer's prior written consent
  • The Insurer shall not be liable for any delay in notifying Marsh of the claim (even if still within 60 days), which prejudiced the Insurer's position, eg if a judgement has been entered against you resulting from your failure to enter appearance or defence.
  • Your full disclosure and cooperation including to provide all relevant information and documents in a timely manner is a condition precedent of policy cover.
  • If you bought Top-up insurance without going through Marsh (or JLT), please urgently inform the Top-up Insurer of the claim or notifiable circumstance as well and keep them updated, since Marsh is unable to do so for you since you did not appoint Marsh (or JLT) to arrange such Top-up Insurance.
  • Your premium shall not be affected unless the Insurer have paid towards any defence costs, judgement or settlement sum in the claim above your firm’s policy base excess. In such event, at your firm’s next policy renewal, 5% of the amount incurred by Insurers on the claim (or 5 times your firm’s premium, whichever is lower) will be added to the premium as claims loading within a 5 year period from the date you notify the claim/circumstance to Marsh (or JLT) but up to a maximum claims loading of 25% of the amount incurred by the Insurer.

 

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For a Claim - As soon as you receive or become aware (but no later than 60 days therefrom) of a demand for or an assertion of a right to compensation/damages or an intimation of an intention to seek compensation/damage e.g. you receive a letter/notice of demand, or a letter with allegations made against you, or you were served with a writ/summons, counter claim or notice of third party proceedings.

For a Potential Claim - As soon as become aware (but no later than 60 days therefrom) of any fact, circumstance or event which you reasonably anticipate could give rise to a claim against you in the future e.g. you discover an error/omission, embezzlement or fraud involving clients monies or a complaint has been lodged against you with the Advocates & Solicitors Disciplinary Board.

There may not be enough time for the Insurers to appoint a panel solicitor ie up to 3 clear business days after the above mentioned documents are complete. Therefore you must take all necessary steps to protect your interest and Insurers interest ie you must:

  1. reply to the letter/notice of demand within the stipulated deadline (without admitting liability) while requesting for an extension of time eg 14 days as you are currently seeking advice on the same; or
  2. enter appearance on time; or
  3. obtain an extension of time to file a defence failing, which you must then file your statement of defence within the required deadline;
  4. attend to any court dates eg case management etc.; and
  5. if any judgement in default ("JID") has been entered against you, you must obtain an order setting aside such JID before Insurers can attend to your claim

No. Your premium will only be increased (claims loading) if and when Insurers have actually made a payment on your claim. Insurers only start paying for your claim only after you have completed paying your Base Excess obligation. The Base Excess is an amount which you shall bear in the event of a claim. Once it is paid, Insurers pay for the balance amount in that claim. Therefore the Base Excess represents a certain amount of the claim which you retain while Insurers shall pay for the balance.

The Base Excess is stated in item 9 of your firm’s Schedule of Insurance. It is based on the firm’s size ie number of lawyers. There are circumstances where the Base Excess is increased for high risk areas eg claims arising from conveyancing transactions, acting for more than one party in a conveyancing transactions or in a claim involving a misconduct by a partner. The Base Excess becomes payable when the Panel Solicitor appointed by Insurers to defend your claim, issues the interim bills for work done on the claim. If the Base Excess amount has not been exhausted by those Panel Solicitor bills, the balance shall be applied towards any judgement/settlement sum if any. Please refer to the Base Excess FAQs for more details.

Once your claim notification is submitted, Marsh will review your notification and send out an acknowledgment letter within 3 working days. If you do not receive an acknowledgement letter within the stipulated time, please call Marsh at +603-2723 3241 / 3388 and ask for the MBar Department.

The online notification process is summarised in the diagram below:-

Online-Notification.png
When your notification is received, Marsh will forward the notification to Echelon Claims Consultants ("Echelon"), the third party claims administrator appointed by Insurer, ie Pacific & Orient Insurance Co berhad.

Echelon will then contact you to follow up with your notification and issue an acknowledgment letter. A panel solicitor will be appointed depending on the nature of your notification.

Writ notifications: A Panel Solicitor ("PS") will be appointed within 14 days of the Firms' notification. However, in practice, Echelon will appoint a PS within 2 to 3 days if the Firm has included all the cause papers in the notification. The appointed PS will then contact the Firm to schedule an interview to obtain all information and/or documents necessary for the defence.

LOD and Circumstance Notifications: A PS will be appointed if the Insurer believes the PS can assist to resolve the situation. Firms can also request for the assistance of a PS.
  1. You will be fully responsible to defend any legal action against you arising from the claim.
  1. The panel solicitor assisting you will be instructed to discharge himself from further acting in your claim within 10 working days from the date of the Insurer’s decline letter.
  1. You can appeal against the Insurer’s decision by writing in to Marsh or by contacting Bar Council PII & Risk Management Department.
  1. You can invoke Clause 23 of the 2020 Certificate of Insurence (or the corresponding clause in the Certificate of Insurance for the year your claim is registered under) to have the matter arbitrated.