Why do you need professional indemnity cover?
If you provide services or advice to people as part of your job, it’s fair to say that you always do your best to make sure that nothing goes wrong. Given your qualifications and experience, you make sure that your services are first class and your advice is exemplary.
Unfortunately, despite all the care in the world, things can go wrong, or clients can be unhappy, resulting in a claim of professional negligence and legal action. These claims can be made against you personally or your business. Regardless, the legal defence costs can run into the hundreds of thousands of dollars, in addition to any settlement or court judgement. Without appropriate insurance cover, claims of professional negligence can cause financial hardship and damage the reputation of individuals and businesses, which is why you need Professional Indemnity Insurance.
What is Professional Indemnity Insurance?
This is a special type of insurance for professionals and the businesses who provide advice or services to customers, such as real estate agents, accountants and builders. This insurance policy protects against both actual or alleged claims of financial loss, property damage and personal injury connected with your personal services or advice.
The insurance pays both legal defence costs and any subsequent court award or settlement. It can also pay for the costs of hiring a public relations expert to protect your reputation.
What does Professional Indemnity Insurance not cover?
This insurance policy does not cover risks including breaches of directors’ duties (to your own business), which are covered under a Management Liability policy, Public & Products Liability or Workers’ Compensation.
Who can benefit from Professional Indemnity Insurance?
There are a whole host of professionals who can benefit from this type of insurance, whether a sole trader or business owner. A professional can really be anyone that provides advice or a service, including unpaid advice. Professionals include (this list is not exhaustive):
- IT professionals
- Financial advisers
- Mortgage brokers
- Health and Allied professionals
- Real estate agents
- Beauty therapists
- Marketing consultants
- Swimming pool inspectors
- Travel agents
- Health and safety consultants
- HR professionals
- Interior designers
To decide if this type of insurance can be of benefit to you, talk to an insurance specialist today. Contact Lisa Carter.
This article originally appeared on Insurance Advisernet News and has been published here with permission.