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GSI Direct FAQ's

Answering your Questions

Questions about us and buying your policy online

Although we have access to the global market, we are based right here in New Zealand. This means our underwriting and claims handling staff are local to you and not working from overseas. Our 0800 number and live chat functions are answered by experienced professionals and therefore we are able to respond to any of your questions quickly. 

This is also especially beneficial when it comes to dealing with claims as it means we are not only in a position to respond promptly but, able to deal with them using our breadth of local knowledge.

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For some business activities we are significantly cheaper than the premiums some people are currently paying and we are often asked why this is.

There are a number or reasons:

  • There is a high administration cost for small insurance policies when they are transacted using physical forms and either posting and emailing these between brokers and different insurance companies. This cost can represent a substantial amount of the total premium paid. By buying your Professional Indemnity insurance directly online through GSI Direct, you only have to answer a few questions, and your documentation is automatically generated and emailed through. We save on all that administration cost, which we pass directly onto you.
  • We recognise that for many of the businesses, individuals or contractors we cover, there is a lower probability of having a claim, than some other types of professional services. Whilst there is still a risk that you could have a claim we believe that our premiums reflect the actual risk you are exposed to.

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The great answer is you don’t! For most of the businesses or individual contractors we insure there are only a few questions that need answering online and then you’re done. You’re policy will then be issued straight away and emailed to you.

When it comes to renewing your policy next year, if nothing has changed it can be automatically renewed and you don’t have to do anything more.

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When you select your ‘profession’ on the quote page you’re also asked to select a ‘sub profession’. 

You are actually covered for all sub profession activities listed under a profession. For many business activities you will cross between two sub professions such as IT services where you may do software development, testing and consulting, or a business consultant may do some management consultant and project management work.

We do require you to select the sub profession that best fits the main part of your activities in order for us to monitor the types of contractors and businesses we are covering and sometimes the premium can be different for sub professions selected within a profession.

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Two Professions

If your activities cover two professions themselves, often we can still cover you with the same premium. We will however need to find out some more information from you about what your business does. Simply give us a call – 0800 463 366 (0800 INDEMNITY)

Two Sub Professions

You’re covered for the activities of ALL the sub professions listed under a profession. Whilst you are required to select the one that best describes your activities, or represents your main activity, you will also be covered if you do other work that falls under another sub profession listed. The full list of sub professions will be included in your insurance schedule that is automatically emailed through as soon as you have purchased the policy.

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If your business activities don’t fit within any of the professions or sub professions listed then give us a call – 0800 463 366 (0800 INDEMNITY)

Either:

  • We can look to specifically agree your activities after finding out some more information if it’s a similar risk exposure to the types of businesses or individuals we insure.
  • OR, it may be that we currently aren’t able to provide cover to your profession.

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The turnover drop down box on the quote page has a number of income brackets to select from.

This will be either the income of your business or your contracting rate over a 12 month period. It should be what you have earned over the previous 12 months.

If however, you are a new business, or you have started out as a contractor, or your income will be significantly higher in the coming 12 months than what it has been previously, you should select the turnover bracket of your expected income over the next 12 month period.

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The number of employees’ option should be the number of people working in the business who are employees, directors, principals, partners or shareholders.

If you are a sole trader or purchasing this policy as an individual, select one employee.

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We often get asked this question.

You need to make your own assessment as to what limit you would like to have in place. In making this decision it is important to weigh up the cost vs benefit and to consider the risks that face your particular business. You understand your business, your clients and the risks attached to working in your industry for those clients.

Generally if your business consults to clients who operate in high-risk environments, it is a good idea to consider purchasing a higher level of cover to protect you from any responsibility or exposures you could have from something going wrong.

The level of cover you choose should take account of:

  • The legal costs of defending a claim – how much you are likely to need to defend legal claims made against you.
  • The possible compensation award – how much you might have to pay to settle a claim or if a court awarded judgment against you.

You should select a level cover that takes into account these two factors in the context of your clients, your services and your industry to make sure that the insurance is likely to be enough to pay both the legal fees and the damages/compensation you might have to pay if a claim was successfully made against you.

How do I assess this?

You may look to understand:

  • The number and size of the client contracts you’re engaged in
  • The type of the clients you’re working for and the activities they engage in
  • The overall value of the projects you may be involved in
  • The size of a legal claim that may be made against you

You need to think of the worst-case scenario because, ultimately that’s what you’re insuring against, and you need to remember that legal fees can escalate quickly and can be expensive if a case does go to court.

Other factors

There may be a number of other relevant factors to consider:

  • You may be required to have a specific amount of Professional Indemnity insurance and / or public liability insurance for a contract that you are entering into. In this case you can buy this limit and provide your schedule to the other party if necessary to show you have this insurance in place. (As long as you also are comfortable it is sufficient.)
  • Contracts may not have a specific limit but there will usually be an indemnification clause which is usually saying that you will be held liable if you cause the other party loss, through providing negligent services or causing physical damage for example. It’s important to understand this clause and what obligations are being placed upon you.
  • Sometimes you may be requested to have what you consider an excessive limit of indemnity under a contract, particularly if you are an individual contractor to a large organisation and they have standard terms and conditions. In these cases you can look to negotiate with the company to reduce this to perhaps $1 million to $500,000, again as long as you are comfortable the level of cover is sufficient.

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You can pay your insurance by Visa or MasterCard through our secure portal at no additional cost to you.

Alternatively, you can make a bank transfer to our account. Our bank details will be provided if you select this option on the payment page and via email.

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Currently we only offer an annual payment.

Why not a monthly option? Our processes and systems are set-up to bring affordable liability cover to contractors, consultants, professionals and small businesses. By keeping our processing straightforward we are able to keep premiums low.

Note: When you are quoted a monthly payment for insurance it will usually include a financing cost. This financing cost can often be at credit card interest rates and potentially over 20% APR. We would rather not charge our customers such high levels of interest.

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Yes and Yes.

If you purchase your policy and realise that you do not actually need the cover for whatever reason, we will refund you in full. (Providing however that we have not already been covering you for providing services.)

If you want to cancel your policy during the policy period we will refund you the remaining premium on a pro-rata basis based on the number of days you have had the policy for.

Note: When cancelling a policy always consider that the policy is ‘claims made’. Please refer to our blog and FAQ information on this.

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You can provide the “Policy Schedule” to third parties that require evidence of your insurance cover.

This is emailed to you as a link when you purchase your insurance which you can open and save as a PDF, or you can log in through our website and download your documents at any time.

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If you pay via credit card your policy documents will be automatically emailed to you immediately after you make payment. You will receive a welcome email with links to your policy schedule, invoice and other relevant documents.

If you pay via bank transfer we complete the sale in the system once we receipt cash. Usually this is the following morning after the day you have made the transfer. At this time you will receive a welcome email with links to your policy documents.

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Questions about the insurance

We’ve got some great information on our “products” pages. 

We’ve written some longer blog articles too. 

Or we really are happy to take your call if you’d like to talk it through with us – 0800 463 366 (0800 INDEMNITY)

We recognise that buying insurance cover through an online website might be new for many people, particularly for business insurance. Therefore we have experienced insurance professionals who answer our phones who are based in New Zealand.

You aren’t coming through to a call centre to speak to someone who doesn’t have any technical knowledge, or find out that the website is from further afield. We encourage our clients to make sure they trust whoever they purchase their insurance from.

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Generally all insurance policies for Professional Indemnity, Directors and Officers, Employers Liability and Statutory Liability are underwritten on what is called a ‘claims made’ basis. This means that your insurance policy covers you for a period of time (usually for 12 months) in which a claim is made against you. 

The ‘trigger’ for cover relates to the time a claim for compensation is made, NOT the time you did the act or provided the services which the claim relates to.

What this means is that you will likely want to have the policy in place from the time you start providing services and for a period of time after you have stopped. If an error is found in your advice / service 6 months after you provided it to the client for example, you will need to have a Professional Indemnity policy in force at the time the claim is made (i.e. at that date 6 months after).

It will depend on the nature of your work and how long afterwards a mistake or error could become known, as to how long you need to keep Professional Indemnity cover in place.

This is not an issue when you are providing on-going services and keep Professional Indemnity cover in place continuously. It becomes an issue when you stop your business, stop contracting, become an employee instead of a contractor, or changing business activities and not having your previous activities covered by your current policy.

Have a look further at “What is run-off cover and why would I need it?” in the FAQs section.

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All ‘claims made’ policies have a retroactive date on their policies, and it’s something very important to know when you are purchasing your policy. (For an explanation of ‘claims made’ refer to the previous FAQ question.)

The retroactive date is the date from which point onwards your services are covered.

A claim could relate to work you did last week, last month, last year or even 5 years ago and this is where the retroactive date is really important.

If you take out Professional Indemnity cover with a retroactive date at the start of the policy, then you will have no cover at all for any work you completed before that date, if a claim is made against you. For example, if your retroactive date is the 1st of January 2013 and you get a claim tomorrow for services provided in December 2012, your policy will not cover you.

One of the most important benefits of coverage through GSI Direct is that for all our ‘claims made’ policies, including Professional Indemnity insurance, our retroactive date is UNLIMITED! This mean all your previous work for the profession you have selected is covered. This is not common in the NZ insurance industry and a key benefit of our cover.

If nothing else, check the date on your existing insurance policy.

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If there is a claim made against you it is the amount that you must pay first, before the insurance company will start to pay.

There are several reasons why a deductible is included:

  • Most people purchase insurance for the risk of something large going wrong, rather than small issues that they are able to deal with themselves.
  • A deductible will reduce the premium that you pay as there is often a high administration cost for an insurer in dealing with very small claims.

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We have very competitive (low) deductibles.

Professional Indemnity

The deductible applicable under our Professional Indemnity policy is calculated based on your turnover:

  • $0-$50,000 turnover = $250 excess, each and every claim
  • $50,001 – $500,000 turnover = $500 excess, each and every claim
  • $500,001 – $1,000,000 turnover = $750 excess, each and every claim
  • $1,000,001 – $1,500,000 turnover = $1,000 excess, each and every claim
  • $1,500,001 – $2,000,000 turnover = $1,500 excess, each and every claim

Public and Products Liability, Statutory Liability, Employers Liability

  • The deductible is $250.

Directors and Officers

  • The deductible is $500.

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Professional Indemnity insurance is written on what is commonly known as a ‘claims made basis’. For a claim to be covered the policy must be in force at the time the claim is notified and the claim must be notified during the period of insurance in which it occurred.

Annual cover helps ensure you have continuity of cover. Even if you stop freelancing or contracting you should consider keeping your annual cover to protect against claims arising from work completed in the past.

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Have a look at the “What does ‘claims made’ mean?” and “What is run-off cover and why would I need it?” questions in the FAQs.

Essentially you need to consider whether you want your policy to continue after you have completed the work in order to have cover in place if a claim arises after the work has been completed.

For these reasons we only offer an annual policy to our customers.

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Firstly have a look at the question “What does ‘claims made’ mean?”.

Because most liability policies, including Professional Indemnity work on a ‘claims made’ basis, this means that you will have a risk of a claim being made against you for a period of time after you’ve provided the service / completed the work.

In some industries this could be years after the work has been completed whilst for other types of work it would be expected to occur within a shorter timeframe.

For example, the results of a marketing campaign may be known within months as to whether it was successful or not, whereas a mistake in a tax return by an accountant may only be noticed several years after the return is filed.

When your business, contracting or consultancy work is on-going your current liability policy will provide cover for a claim relating to your previous work, but only back to the retroactive date*. When you stop providing your business services, whether it be that you stop working, shut down your business, retire, take a career break or change the type of services you provide, you will still have an on-going risk of a claim being made from previous work.

In this type of situation you can purchase what is called run-off cover. Run-off cover is usually cheaper than having to renew the same policy to recognise the fact that your risk of a claim has reduced now that you have stopped working.

GSI Direct has pre-determined run-off rates:

  • 50% of your annual premium in the 1st year of run-off.
  • 25% for each year thereafter.

But, you must have purchased insurance through GSI Direct whilst your business was operating, and not had any claims made against you.

* With GSI Direct we have an unlimited retroactive date meaning all your previous work within the business description is covered.

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The GSI Direct policy wording includes all the types of liability cover we offer, which are split into different sections of the wording.

Your policy schedule will indicate which of the types of cover you have purchased and if you have not purchased a particular cover then that section of the wording will not be applicable.

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Who is GSI Direct?

GSI Direct is a trading name of GSI Insurance Brokers (Auckland) Ltd, a New Zealand-based company. GSI Insurance Brokers (Auckland) Ltd is a Lloyd’s coverholder and an Authorised Agent of certain underwriters at Lloyd’s. GSI Insurance Brokers (Auckland) Ltd trading as GSI Direct arranges insurance on behalf of the insurer and coordinates the response when a claim is made. GSI Direct does not provide personalised advice on insurance.

Contact Details

Level 1, 490 South Titirangi Road – Titirangi
PO Box 15854, New Lynn
Waitakere 0640, New Zealand

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