What is Professional Indemnity Insurance?
If your business provides advice to your clients, it’s important to obtain protection for your business against allegations of malpractice or professional misconduct.
Businesses which provide professional advice or services, can be held liable for claims arising from errors or omissions committed by the business or their employees or consultants. This means that if you do something, or fail to do something, in the course of your work and a client suffers…or alleges they’ve suffered a loss, they may take action against you.
There is a much greater understanding of their legal rights in the event of a financial loss and there has been a corresponding increase in the number and size of the claims being brought against these businesses.
These Policies provide protection for claims brought against the company or their principals, or employees.
In addition to the payment of any settlement, substantial investigation and defence costs can be incurred in defending the company and its reputation. In many cases these claims can be without substance, but you are still required to defend them.
Some other elements which make this cover particularly complicated are…
- The excess could apply to the investigation costs or only following a payment to the claimant.
- The policy operates on a claims made basis, which means that the Policy must be current at the time that the claim is made
against you…there is no cover if you have allowed the policy to lapse…even though you had cover at the time of the cause of the action.
- The “standard” policy may or may not cover injury or damage to property, which is vital for some industries
Provided that you have the “right” Policy, you can defend your business against the claim for damages, but also the damage to your reputation. This means that you can approach your work confidently, knowing that we will be there for you if something goes wrong.