Professional Indemnity Insurance for Insolvency Practitioners

Who This Cover Is For

This professional indemnity insurance for insolvency practitioners is intended for professionals who perform court-appointed, statutory, and fiduciary roles in the administration of insolvent estates. It is structured for indemnity insolvency professionals whose duties involve legal, financial, and regulatory accountability in formal insolvency appointments.

The cover is typically suitable for:

• Liquidators appointed to administer company liquidations
• Trustees of insolvent estates handling estate administration and distributions
• Court-appointed insolvency practitioners acting under statutory authority
• Insolvency practices managing section 70, section 394, or similar trust accounts

It is designed for practitioners whose work exposes them to claims arising from alleged negligent acts, errors, omissions, or fiduciary breaches in the execution of insolvency duties, with insolvency indemnity insurance provided subject to underwriting acceptance and policy terms.

Insurance for Court-Appointed and Insolvency Roles

Professional indemnity insurance for insolvency practitioners is structured to respond, subject to policy terms, conditions, exclusions, and limits, to civil liability arising from the performance of professional duties as a liquidator, trustee of an insolvent estate, or related insolvency appointment.

Cover is typically arranged on a claims-made basis and may include a combination of the following core sections, each subject to its own terms, conditions, limits, and excesses:

• Professional Indemnity
• Fidelity Guarantee
• Misappropriation of Trust Funds

Eligibility for cover is determined by the nature of the practitioner’s activities and appointments, together with underwriting acceptance, rather than by title alone.

Professional Indemnity Cover

Professional Indemnity insurance for insolvency practitioners is designed to respond, subject to the policy wording, to actual or alleged negligent acts, errors, or omissions committed in the execution of professional insolvency duties. This may include associated legal defence costs and expenses, where applicable.

Depending on the practitioner’s activities and underwriting acceptance, a range of optional extensions may be available, including:

• Claims preparation costs
• Defamation
• Defence costs for appearances before statutory or regulatory bodies
• Liability following employee dishonesty
• Loss of documents
• Sub-contractors and correspondents

Availability of extensions is subject to insurer underwriting, policy terms, conditions, and applicable sub-limits.

Fidelity Guarantee Insurance

Fidelity Guarantee insurance is designed to respond, subject to policy terms and conditions, to direct financial losses suffered by the insured arising from acts of fraud, theft, or dishonesty committed by an employee during the course of their employment.

This section of cover is typically arranged to complement professional indemnity insurance by addressing internal dishonesty risks that may arise within an insolvency practice.

Misappropriation of Trust Funds (MOTF)

Misappropriation of Trust Funds insurance is designed to respond, subject to exclusions and conditions, where a third party brings a claim against an insolvency practice arising from the theft or misappropriation of money or property held in trust in relation to an insolvent estate. This may include funds held in statutory trust accounts, such as section 70 or section 394 accounts, where applicable.

MOTF cover may be structured in one of the following ways, subject to underwriting acceptance:

• Blanket Basis – Cover for all employees within the practice.
• Named Positions Basis – Cover limited to specific roles, such as bookkeeping or finance positions.
• Named Persons Basis – Cover limited to specific named individuals.

All MOTF cover is subject to insurer underwriting, policy terms, conditions, exclusions, and applicable limits.

How Shackleton Risk Can Assist

Shackleton Risk Management acts as a licensed financial services provider and insurance broker, assisting insolvency practitioners in arranging appropriate insurance solutions that reflect the nature of their appointments, regulatory obligations, and professional risk exposure. Our role is to provide clarity and guidance in a complex insurance environment by advising on suitable cover structures, including insolvency cover, and facilitating access to specialist insurers, subject to underwriting criteria and policy terms.

For more information on professional indemnity insurance for insolvency practitioners, or to discuss suitable cover options, please contact your broker.