FCA MIPRU professional indemnity requirements for insurance brokers
Reviewed by Matthew Bartlett, Director, Apex Insurance Brokers Limited · Last reviewed 2026-08-05
In short: FCA-authorised insurance intermediaries must hold professional indemnity insurance (PII) under the FCA's MIPRU sourcebook (chapter 3). The minimum limits originate in the Insurance Distribution Directive, which sets euro-denominated amounts — one per single claim and one aggregate per year — that are periodically indexed. Firms must check the current figures in MIPRU rather than rely on a fixed number.
Where the requirement comes from
If your firm is authorised by the Financial Conduct Authority (FCA) to carry on insurance distribution — arranging, advising on or dealing in general insurance contracts — you fall within the FCA's prudential rules for intermediaries. The relevant rulebook is MIPRU, the Prudential sourcebook for Mortgage and Home Finance Firms, and Insurance Intermediaries. MIPRU 3 is the chapter that deals specifically with professional indemnity insurance.
The obligation itself flows down from European-derived law. The Insurance Distribution Directive (IDD) requires insurance intermediaries to hold PII (or a comparable guarantee) covering liability arising from professional negligence. When the UK implemented and later onshored the IDD, the FCA carried those PII requirements into MIPRU. So although the framework is now UK-domestic, the shape of the minimum cover still traces directly back to the IDD.
How the minimum cover is structured
This is the part brokers most often get wrong, so it is worth being precise. The IDD-derived minimum is not a single number. It is expressed as two limits, both originally denominated in euros:
- A per-claim limit — the minimum cover that must apply to any one claim.
- An annual aggregate limit — a higher minimum that must apply to all claims added together across a policy year.
Because the amounts are set in euros and are periodically indexed to keep pace with inflation, the precise sterling equivalent your policy must meet is not fixed forever. That is exactly why we tell clients to read the current figures in MIPRU 3 rather than memorise a number that may have moved. The structure — per-claim plus aggregate, indexed — is stable; the digits are not.
Not sure your PII limits still meet the MIPRU minimum after indexation? We will check your cover against the current rules.
Get a PI quote →"Adequate" cover as well as the minimum
Meeting the indexed euro minimum is the floor, not the finish line. MIPRU also expects a firm's PII to be appropriate to the nature, scale and complexity of its business. A larger broker, or one handling higher-value or more specialist risks, may need cover well above the regulatory minimum to be genuinely adequate. The FCA can and does look at whether the limit purchased is realistic against the firm's actual exposure — not merely whether it clears the headline figure.
In practice, brokers commonly hold indemnity limits expressed in sterling — for example £1m, £2m or £5m per claim — chosen to sit comfortably above the indexed minimum and to reflect the size of the arrangements they place.
What the policy itself must do
MIPRU is not only concerned with the numbers on the schedule. The cover has to actually respond to the liabilities the rules are designed to protect against. Points to check on any broker PII policy include:
- Scope of liability — the policy should cover legal liability arising from the conduct of the regulated business, including negligence.
- Limit basis — confirm both the any-one-claim limit and the aggregate limit meet the current MIPRU thresholds.
- Excess and exclusions — MIPRU addresses how excesses and certain exclusions are treated where they would otherwise undermine the protection; a policy loaded with carve-outs may not satisfy the rules even if the headline limit is fine.
- Additional capital — where a policy does not fully meet the MIPRU requirements, or an increased excess applies, the rules can require the firm to hold additional capital resources to make up the shortfall.
Because MIPRU 3 sets out the detail of how excesses, exclusions and any capital top-up interact, the practical test is always whether your specific wording satisfies the current text of the chapter — a point your broker or compliance adviser should confirm at each renewal.
Who this applies to
The MIPRU PII regime applies to FCA-authorised insurance intermediaries carrying on insurance distribution activities. Appointed representatives operate under the PII arrangements of their principal, and some categories of firm are treated differently depending on the permissions they hold and the money they handle. If you are directly authorised and you arrange or advise on general insurance, you should assume MIPRU 3 applies to you and verify the current requirement directly.
Apex Insurance Brokers Limited is itself an FCA-authorised broker (FRN 724952), so we place PII for fellow intermediaries with the rulebook firmly in mind. If you want your renewal checked against MIPRU before you commit, start a quote with our team.
Common questions
Does MIPRU give a fixed pound figure for the minimum cover?
No. The minimum originates in the IDD as euro amounts that are periodically indexed, so the sterling equivalent can change. MIPRU 3 carries the current figures — always check them there or with the FCA rather than relying on an out-of-date number.
What is the difference between the per-claim and aggregate limits?
The per-claim limit is the minimum that must apply to any single claim. The annual aggregate is a separate, higher minimum covering all claims combined across a policy year. Your PII must satisfy both, not just one.
Is the MIPRU minimum enough on its own?
Only as a starting point. MIPRU also expects cover appropriate to your firm's size, complexity and exposure, so many brokers hold limits above the minimum. Where cover falls short of the rules, MIPRU can require additional capital resources to bridge the gap.
Apex Insurance Brokers Limited is authorised and regulated by the Financial Conduct Authority (FRN 724952). This guide is general information, not advice on a specific policy or a substitute for your policy wording.