As a contractor, having public liability insurance is crucial to protect your business in case your work causes property damage or bodily injury to a member of the public.
While public liability insurance covers third-party claims, it does not cover issues arising from faulty designs, specifications, or advice you provide. If you make changes to a design that then causes problems, you could still be held liable.
That's why it's important for contractors to also consider professional indemnity insurance. This type of policy helps cover legal defense costs and payouts for claims arising from your professional services and advice. Even if a claim is unfounded, simply defending yourself can get very expensive without the right insurance coverage.
Professional indemnity insurance is especially important if you take on large projects, as this coverage is often required contractually by clients. Carrying this insurance shows clients that you are a true professional and have their interests in mind from the very start.
The claims process for professional indemnity insurance can take some time, so it's not something you want to get at the last minute if you can avoid it. Work with your insurance broker to make sure you have adequate professional indemnity coverage for the types and sizes of projects you take on. Your broker can help you understand what is and isn't covered and can assist with adjustments if your business changes over time.
It's wise for anyone involved in construction and development to carry professional indemnity insurance, from builders to surveyors and architects. No matter how careful you are, claims can arise. Always notify your insurer right away if you receive any claim, even if you think it is frivolous. Policies have time limits for claim reporting, so missing the window to report can cause coverage problems later on.
With the right liability and professional indemnity insurance, contractors can feel confident they are protected if the unexpected occurs.