What is Professional Indemnity insurance?
Anyone can make a mistake – but if your business is found liable for negligence, the costs can be financially devastating. Not only can it lead to an expensive lawsuit, but your business’ hard-earned reputation may be damaged as a result.
That’s why Professional Indemnity insurance matters – for help protecting your assets and brand if your advice or insurances causes a client to take legal action.
Who should consider it?
Professional Indemnity insurance is mandatory in some industries, such as medicine, accounting, law and financial advisers.
But even in cases where it’s not required by law, it’s recommended for anyone who is providing professional services or advice in exchange for a fee – like graphic designers, IT Consultants and more. Regardless of your legal obligation, it’s often a customer requirement that you have this cover in place.
What can it cover?
As a wide-ranging insurance solution, Professional Indemnity cover may include anything from accidents to errors and omissions. Depending on your policy, Professional Indemnity can cover:
– Civil Liability: Civil liability to a third party arising out of the conduct of their professional business.
– Inquiry Costs: The cost of defending an inquiry by a regulatory body into the professional conduct of the insured
– Defence Costs: The costs involved in defending a claim triggered by the policy
– Fidelity cover: Direct financial loss of the business caused by the dishonest or fraudulent conduct of an employee which is first
discovered during the period of insurance.
What usually isn’t covered?
Exclusions, the excess you need to pay and limits of liability can vary greatly depending on your insurer. Policies generally won’t include cover for:
– Contractual or commercial liabilities
– Liability which results from fraud and dishonesty
– Depending on your occupation, third party bodily injury/property damage
– Unpaid fees
As with all insurance policies, the devil is in the detail……. so please do read the wording and schedules issued by your insurers. At Balance Advisors we are always here to help you navigate and review these policies so you have a good understanding of what your covered for. We are here to help!