Professional Indemnity

'Professional Indemnity' insurance cover as far as financial advisers are concerned is a joke! Take for instance the case of Storm Financial where billions of dollars were at stake. Storm Financial only had a 'professional indemnity' insurance cover  with AIG for some $25M to $40M (exact figures have never been disclosed) which would have given anyone claiming against it a few cents in the dollar at best.

But wait! Here's the good part! You could NOT claim against Storm's insurers in this regard anyway because the cover had run out and you had to get your claim in before the policy had elapsed. If you were Nostrodamus you might have had a chance but no one else did.

Even the new regulations brought in by ASIC still do not fix the loopholes in the insurance law in relation to "profesional indemnity" insurance.

This is one of the biggest scandals to come out of the Storm Financial disaster but people have paid scant attention to it.

Read the attachments below which will give you an idea of the risks people run when they assume or are told  that their financial advisers have a professional indemnity insurance cover. You need to be afraid! Very afraid!