Professional Indemnity insurance is there to protect against claims made against you, from your clients for wrongful advice, errors or omissions. Professional Indemnity insurance is a necessary protection for any business that provides any type of service or advice to clients.
As claims for professional negligence against firms and individuals continue to rise, so too does the need to ensure you have the widest and most comprehensive professional insurance cover available – cover that not only protects your business, but your reputation.
Professional Indemnity cover need not be complicated, but it is best arranged by a specialist who can explain the relevant details without the need for technical jargon. Our specialists have the experience, knowledge and contacts throughout the market to get you the right cover at a realistic price.
Features and benefits
Our Professional Indemnity cover protects you against compensation claims arising from, but not limited to:
- Negligence (or breaches of duty of care)
- The unintentional infringement of intellectual property rights
- The loss of documents or data
- Defence Costs arising from claims and circumstances
What our customers have to say
What you need to know
Here are some of the most frequently asked questions we receive about our Professional Indemnity cover.
Do I need Professional Indemnity insurance?
If you provide advice, designs or any other professional service to your clients, you must seriously consider Professional Indemnity (PI) insurance. Without it, you could be liable for thousands of pounds worth of legal fees and compensation to your client if you are found to have been negligent in your services to them. However experienced you and your staff may be, it’s always possible to make a mistake or for a client to think that you have. But it’s not just about bad advice, a PI policy covers you against many situations, such as:
- Professional negligence
- Loss of documents or data
- Unintentional breach of copyright, intellectual property or confidentiality
- Defamation and libel
- Loss of goods or money for which you are responsible
In addition, many clients insist you have professional indemnity insurance in force before you can begin work on a contract and many professional or industry bodies require members to hold a minimum limit of cover.
Whenever you arrange PI cover it is vital that your insurer understands all your activities.
Isn’t this just for accountants, lawyers and the like?
Members of the traditional professions must have this cover to be able to advise. But these days a much wider range of “professionals” may need PI cover, such as IT and Management consultants, teachers & tutors, recruiters, designers, photographers, fitness experts and dance teachers to name just a few. Ask yourself the question – if one of your clients suffers a significant financial loss as a result of your negligence where will they go to seek recompense?
How can I choose the right level of cover?
There is no right solution – some argue that you should “buy what you can afford”. In other cases your customer will specify a minimum level of cover. In any event, you should assess the greatest loss that might result from a mistake on any particular project/contract. Ultimately, no one will take on your responsibility to ensure you have enough cover but you should carefully review this area with your insurance broker.
If I work outside of the UK will I be covered?
Not all policies cover work overseas automatically so check the terms of your policy and if not covered already, arrange with your insurance broker for the necessary amendments to be made. Most policies will protect you against claims made against you in the UK but if you want to be defended abroad you may need to change the “jurisdiction clause” and this must be correct to ensure your activities are covered. Tell your insurance broker about all your overseas work especially if you change this during your policy period.
My policy is on a “Claims Made” basis – what does that mean?
Unlike many liability insurances Professional Indemnity is underwritten on what is known as a ‘claims made basis’. This means that the policy will only provide cover for incidents that are discovered and notified to the Insurers during the period of insurance. Your policy will provide cover for advice given in previous years, often limited to a retroactive date (see below). It is important to note that if you want to continue with the protection PI cover provides you need to keep renewing cover or buy “Run Off” cover.
What is a retroactive date?
The retroactive date refers to the date from which work undertaken is covered i.e. a current Professional Indemnity policy with a retroactive date of 1st January 2005, will provide cover for claims arising out of work undertaken on or after 1st January 2005. Any work prior to this date will be excluded. If no retroactive date is shown, or if it is noted as ‘None’, the cover is provided relating to all work that you have undertaken previously (subject to that work falling within the scope of activities declared to Insurers).
What is Run Off cover?
If you are closing your company or are a sole practitioner/partnership and are retiring from practice that does not mean that claims will not arise on work undertaken in prior years. Whilst the majority of claims are made quite quickly, it is still possible for a claim to go back many years, and for this reason most insurance professionals will recommend a minimum of six years' run off cover. If no policy is in place at the time a claim is made, then you may face liability which can not only be traumatic, but financially devastating.
Do I need annual cover even if I only have a short-term contract?
In some cases your contract may only last for a few weeks, but you will need to have a policy in place at the time of any claim being made. So, if you complete a contract but your client doesn’t make a claim until after you have finished the work, you would need to have a policy in place at the time of the claim in order for you to benefit from policy protection.
Taking out an annual policy means that you are covered continuously, so you can be reassured that you will be protected in case of a claim. Many smaller contractors/service providers find that continuing their cover even after they have finished working allows them the peace of mind of knowing that they will not be left exposed to any claims made on historical work.
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