When buying Top-Up Professional Indemnity Insurance (Excess Layer PII) for law firms in Malaysia, the policy wording often comes with technical terms that can be confusing.
At Minaris Risk Management, we believe in making things simple for our clients. Here’s a clear explanation of the 23 most common terms you’ll find in your Top-Up PII policy—so you know exactly what you’re covered for.
1. Limit of Indemnity
The maximum amount the insurer will pay for claims under the policy during the insurance period.
2. Any One Claim and In the Aggregate
- Any One Claim: The maximum amount payable for each claim.
- In the Aggregate: The total amount payable for all claims in a single policy year.
- Example: RM1 million any one claim and RM2 million in the aggregate = max RM1M per claim, total RM2M for the year.
3. Any One Claim and Double in the Aggregate
Each claim is capped at RM1 million, with a total cap of RM2 million for the entire policy year.
4. Any One Claim and Triple in the Aggregate
Each claim is capped at RM1 million, with a total cap of RM3 million for the entire policy year.
5. Any One Claim and Unlimited in the Aggregate / Each and Every Claim
Each claim has the per-claim limit (e.g., RM1 million), but there is no overall cap on the total number of claims within the policy year.
6. Deductible
The amount your firm must pay first before the insurer covers the rest of a claim. For Top-Up PII, this deductible is equal to the mandatory Bar Council PII policy limit.
7. Underlying Policy
The mandatory Bar Council PII policy. Your Top-Up policy provides additional coverage on top of this limit.
8. Period of Insurance
The duration of your policy, which can be 12 months or a short period (e.g., midyear to renewal date) depending on when coverage is purchased.
9. Territorial Limit – Malaysia
The incident must occur within Malaysia for coverage to apply.
10. Jurisdiction Limit – Malaysia
Legal proceedings must be filed in Malaysian courts for the insurer to respond.
11. Retroactive Date
Covers claims from past work as long as you’ve had continuous insurance coverage and were unaware of any potential claims before the policy start date.
12. Gross Premium
The total premium payable:
- Annually, not monthly
- Per firm, not per lawyer
13. Premium Warranty – 60 Days
The premium must be paid within 60 days from the policy start date. If not, the policy is automatically cancelled from inception, and the insurer keeps the prorated premium for the period on risk.
14. Compensation for Court Attendance
Daily allowances if lawyers or staff attend court as witnesses for a covered claim:
- RM500 per Sole Proprietor/Partner
- RM300 per Legal Assistant/Employee
- Maximum RM50,000 per policy year
15. Misconduct (Dishonesty/Fraud Sublimit)
Covers the firm’s vicarious liability for dishonest or fraudulent acts by employees or partners—up to a fixed sublimit. The wrongdoer themselves is not covered.
16. Mitigation Cost for Cyber Event
Pays for costs incurred to reduce further losses after a cyber incident affecting the firm’s legal practice.
17. Cyber Event Affirmative
Covers claims arising from cyber-related wrongful acts in the course of legal practice.
18. Automatic Inclusion & Exclusion of Lawyers
No separate endorsements needed when lawyers join or leave the firm during the policy period.
19. Endorsement
An official document issued for:
- Changes in limit of indemnity
- Branch address changes
- Policy cancellations
20. Certificate of Insurance (CI)
Issued whenever there are updates to lawyer names (inclusion or removal).
21. Loss of Documents
Covers costs to restore or replace lost or damaged legal documents.
22. No Claims Warranty
Confirms that no known claims or incidents likely to give rise to a claim exist before the policy start date.
23. Defamation, Libel & Slander
Covers claims alleging defamation, libel, or slander in the course of professional work.
Final Thoughts
Top-Up Professional Indemnity Insurance is crucial for law firms handling complex, high-value cases. But understanding the policy terms is just as important to avoid surprises during a claim.
At Minaris Risk Management, we help law firms:
- Choose the right limits for any one claim and aggregate coverage
- Understand the difference between territorial and jurisdictional limits
- Ensure there are no coverage gaps across mandatory and top-up policies
Before you renew your Top-Up PII, review these terms carefully—or speak to our team for expert guidance tailored to your firm’s needs.
Jayadarshiniy Sankar is a Senior Insurance Advisory Manager with a background in law and over 5 years of experience in professional indemnity and general insurance. She specializes in regulatory compliance and client solutions, delivering tailored coverage with prompt, results-driven support while actively educating clients through industry content and guidance.