In our fast-paced business environment, even the most reputable company can end up in a dispute with a client over an error, delay or alleged contract breach. Professional indemnity insurance, also known as errors and omissions insurance or professional liability insurance, provides essential protection for any business that advises clients or provides professional services. This includes not just accountants, architects and solicitors, but also emerging professions and services. In some cases, professional indemnity insurance may even be a regulatory requirement.
Of course, as a professional you never intend to make a mistake. But should an error occur or a client lodges an allegation, professional indemnity insurance financially protects your business by covering the costs of defending claims and paying compensation. It safeguards your business against allegations like:
Professional negligence and breaching duty of care
Defamation from remarks, whether intentional or not
Infringing on intellectual property rights and copyrights
So how do you know how much cover to get? When deciding on your policy's limit of indemnity, consider:
Contract requirements and obligations
The size of your contracts
Potential legal expenses costs
Professional indemnity policies work on a 'claims-made' basis, meaning claims can only be made while your policy is active, not when the work was done. If you cease trading or alter cover, discuss implications with your insurance broker.
Importantly, policies cover not just actual claims, but problematic circumstances that could prompt future claims. If you discover an error before a client alleges negligence, notify your insurer so they can fully investigate and help mitigate a potential claim.
Protect your livelihood and business with professional indemnity insurance suited to your unique risk factors and industry. Speak to Keep Insurance Brokers to review your specific needs.