Professional indemnity policies written on a claims-made-and-notified basis contain a deeming clause. If the insured notifies a circumstance during the policy year that later gives rise to a claim, that claim is deemed to have been made during the year of notification. The mechanism only works if the notification is capable of being understood as a notification. A vague, sweeping statement made at year end will not do the job.
Two English decisions set the framework. In Kajima UK Engineering Ltd v The Underwriter Insurance Co Ltd [2008] EWHC 83 (TCC), the court held that a broad notification referring in general terms to defects across a project was not sufficient to engage the deeming clause for later, specific claims. In HLB Kidsons v Lloyd's Underwriters [2008] EWCA Civ 1206, the Court of Appeal restated the specificity requirement - a notification must convey enough information for the insurer to understand what is being notified and to reserve against it.
Drawing the two decisions together, a circumstance notification generally needs to identify:
None of those points requires certainty. The insured is not being asked to prove the claim. The insured is being asked to describe the matter with enough particularity that an underwriter reading the notification would recognise it if a claim later landed on the desk. A blanket reference to "a number of matters that could conceivably become claims" does not clear that bar.
Firms with mature risk registers know how uncomfortable the middle ground can be. Over-notify - send everything, just in case - and the next renewal insurer sees a wall of orange flags on the proposal form, which affects both premium and appetite. Under-notify, and a matter that quietly ripens into a claim next year may fall between the two policies: the incoming insurer treats it as a known circumstance excluded from cover; the outgoing insurer says it was never properly notified. That is precisely the outcome the deeming clause is designed to prevent, and the outcome that Kajima shows can still occur if the notification lacks specificity.
Larger professional firms address this through an internal escalation process. Fee earners flag matters against a defined threshold - a written complaint, a request to return files, a settlement discussion, a limitation date approaching on advice that turned out to be wrong. Those flags feed a risk register that a nominated partner or the COLP reviews quarterly. Where a matter meets the threshold, the firm documents a discussion with the broker on whether to notify. That documented discussion matters. It shows the firm applied its mind, took advice, and reached a decision - useful both if a claim later emerges and if a regulator asks how the firm handled the risk.
A hypothetical mid-sized solicitors' firm sends its insurer, on the last day of the policy year, a notification that reads: "The firm has approximately 30 open matters where a client dispute could conceivably arise." No files are identified, no clients are named, and no acts or omissions are described. Under Kajima, that notification is likely to be insufficient. If any of those 30 matters becomes a claim in the following policy year, the deeming clause may not attach the claim to the notifying year. The outgoing insurer may decline; the incoming insurer may point to it as a known matter.
Compare the specific notification: "Matter reference 2025/1187 in the conveyancing department. Client name available on request. On 14 October 2025 the client wrote to complain that a drainage search omission caused them to complete on a property with an unadopted access. The firm is investigating. A claim for the diminution in value may follow." That notification identifies the file, the client, the act alleged, the date and the nature of the possible claim. It engages the deeming clause on its face.
See the companion entry on the distinction between a notification of claim and a notification of circumstance. For sector-specific context, see the solicitors' PI guide, the accountants' PI guide and the architects' PI guide. Apex is happy to review a firm's notification protocol as part of a renewal or mid-term review.
Apex Insurance Brokers Limited is authorised and regulated by the Financial Conduct Authority. Firm reference number 724952. This entry is general information, not advice on any particular policy.