Policy mechanics
Notification of circumstances: when and how to notify your insurer
What counts as a notifiable circumstance, why timing matters, and how notification protects you even before a formal claim arrives.
Key takeaways
- ✓A "circumstance" is any situation that could reasonably be expected to give rise to a claim — not only a formal letter of demand or summons
- ✓Notifying a circumstance during your current policy period preserves cover for a claim that crystallises later, even after that policy has expired
- ✓Failing to notify promptly is one of the most common grounds insurers use to dispute an otherwise valid claim
- ✓Notification does not require you to admit fault or liability
What counts as a notifiable circumstance
The threshold is lower than most professionals assume. It includes an informal complaint from a client, discovering your own error before the client has raised it, a project running materially over budget or behind schedule where a dispute seems likely, or receiving a letter from an attorney requesting information about your work.
You don't need certainty that a claim will follow — only a reasonable possibility, based on what you know at the time.
Why timing matters more than it seems
Because PI is written on a claims-made basis, a circumstance notified within your current policy period is dealt with under that policy, even if the claim itself only formally crystallises after that policy has expired or you've since switched insurers. This protects continuity of cover for issues you already knew about.
The opposite scenario is the real risk: if you switch insurers without disclosing something you were already aware of, the new insurer can treat it as a prior known circumstance and decline it outright. Our guide to prior known circumstances covers this in detail.
How to notify
Notify your broker or insurer in writing, describing the relevant facts as you understand them, without making admissions of fault. Keep a record of what you disclosed and when — this becomes important if the matter is ever disputed later.
FAQ
Frequently asked questions
No — a reasonable possibility that a claim could arise is enough to justify notification. You don't need to wait for certainty.