PI premiums · How they work

How PI insurance premiums are calculated — UK 2026

Reviewed by Apex Insurance Brokers (FCA FRN 724952) · Published 15 July 2026

PI premiums aren't a flat rate — underwriters combine multiple rating factors to arrive at a price. Understanding the mechanics helps professional firms present the best possible case at renewal.

The core rating factors

Turnover / fee income — the biggest single driver. Higher fees generally mean higher claim exposure.
Sector — solicitors, IFAs and architects (BSA 2022 exposure) attract higher rates than lower-claim sectors.
Claim history — each notification and settled claim materially affects rate.
Cover level and structure — higher aggregate limits cost more; each-and-every basis costs more than aggregate.
Territorial exposure — work in US, EU or elsewhere adds premium.
Firm structure and staff numbers — more staff means more exposure points.

How underwriters view different sectors

Solicitors: high claim frequency but usually predictable severity; SRA MTC provides underwriting framework.

Architects: BSA 2022 s.135 has re-priced HRB-active firms materially.

Accountants: audit-registered firms pay materially more than non-audit firms.

IFAs: DB pension transfer legacy and Consumer Duty (PRIN 2A) discipline continues.

Engineers: BSA 2022 exposure similar to architects; structural work highest-priced.

IT consultants: usually lower rated unless handling regulated/critical infrastructure data.

Rating factors under professional control

Fee income — the biggest single driver.
Work profile — higher-risk work attracts higher rate.
Claim history — recent claims uplift rate materially.
Cover level chosen — higher limits cost more but not proportionally.
Deductibles and excesses — higher excesses reduce premium modestly.

What firms can do to reduce premium

Provide complete submissions — underwriters rate uncertainty higher.
Document risk-management processes — training, systems, protocols.
Approach the market early — renewal negotiated in the last 7 days rarely goes well.
Consider aggregate limit sufficiency — over-buying is expensive; under-buying is worse.
Widen the market where the incumbent won't move.

Frequently asked

What percentage of turnover is PI premium?

Varies hugely. Solicitors: 1-3% of turnover typically. Architects: 2-5%. IFAs: 3-8%. Low-risk consultants: often under 1%.

Why does one claim double my premium?

A single claim represents new information about your risk profile. Insurers rate accordingly. Multiple claims over years compound.

Can I negotiate my PI premium?

Yes — through broker representation. Direct negotiation with the insurer rarely delivers as well.

Does the size of firm affect premium?

Materially. Larger firms benefit from economies of scale on rate; also spread claim risk across more work.

Do IRRs like Consumer Duty affect premium?

Yes — PRIN 2A has increased pricing discipline in regulated financial services PII.

How much of the premium goes to broker commission?

Typically 15-27.5% of gross premium. Some firms pay explicit fees instead; approach depends on the firm.

Speak to a specialist broker

Get a considered PI quote from Apex

Get a quote Speak to a broker

Apex Insurance Brokers Limited is authorised and regulated by the Financial Conduct Authority. Firm reference number 724952. Registered in England and Wales, company number 07014570.

Offices: QCS, 53 Queen Charlotte Street, Bristol BS1 4HQ · Unit 24, Basepoint Centre, Jubilee Close, Weymouth DT4 7BS