Professional indemnity insurance is designed to protect professionals who provide advice to their clients. The protection is for the potential costs associated with legal claims that can arise from third parties. These legal claims can arise out of giving the incorrect advice, breaching your professional duty, or omitting information that would be vital to the service you provide for your clients in the course of your business.
If you are a professional providing advice it is recommended you take out professional indemnity insurance to protect yourself from bearing the full costs of a negligence claim against you. Professionals which should consider indemnity insurance include but are not limited to:
- Legal professionals
- IT and web consultants
- Marketing professionals
- Stock brokers
In real-life this means if you give the wrong advice or do something negligent in the course of your job and your client suffers a financial loss as a result – they might take legal action against you. The professional indemnity insurance is in place to help defend your business against the claim and prevent financial loss.
Financial loss can not only mean the legal costs, but the payout if you lose the legal battle. It can cost a great deal of time and money to defend claims against malpractice, professional misconduct, breach of duty, or negligence. And you could also be found responsible for the actions of your partners, other directors, employees, or volunteers performing work for your business.
A professional indemnity insurance policy will safeguard your business so you can perform your job with confidence and know that if something does happen, you will have back up. Some professions even have guidelines or necessary levels of insurance that need to be met before proceeding with work. It is always best to check with the industry bodies to ensure you are correctly covered.
A good insurance broker will also be able to assist with advice regarding your professional indemnity insurance. If you need assistance with yours, contact Contractor Cover today and we will more than happy to help you.