Do I need professional indemnity?
Whether our daily working lives are increasingly spent in a blame culture bubble is open to debate. But if you offer advice to clients it makes sense to have professional indemnity insurance to cover yourself if things go wrong.
We often hear phrases about insurance claims these days. From ‘ambulance chasers’ to ‘compensation culture’, where details about people taking action for financial reasons is in the news.
The reality is that people have easy access to legal services that specifically set out to gain compensation for perceived wrongdoing.
If you are a professional, offering services to the public, that means you could become a target if the advice you give does not match up to expectations, or it causes financial damage.
You probably need PI if you’re an accountant, management consultant, estate agent, computer specialist, photographer, writer or an architect. There are many more professions that could benefit from cover.
What they have in common is they provide valuable information, services or data to clients.
They are all highly sought after. People and organisations need what they offer. If standards slip or errors are made, however, it can lead to claims being made against them.
What does professional indemnity offer?
First and foremost, professional indemnity insurance (PII) offers peace of mind. It means that you can complete your day-to-day business knowing that you have back-up should you need it.
If you have been blamed and have a claim for compensation against you pending, with PI cover in place you can carry on working.
PI also gives you a business edge. While holding adequate professional indemnity cover is a requirement of professional practice when you join certain organisations, it can also become a valuable asset.
With comprehensive insurance cover in place you will stand out from others. Potential clients will see that you conduct yourself professionally, and take your responsibilities to others seriously.
Frequently asked indemnity questions
There are many questions asked about professional indemnity insurance. Your circumstances, the business environment in which you operate, and the level of cover required means that no one answer fits all.
John Heath Insurance has many years of experience providing professional indemnity insurance for clients. If you have a range of questions, give us a call and we can address each issue. Otherwise, here are a couple of regular FAQs:
Short-term indemnity cover
Can you get PII that covers, say, a three-month contract? The simple answer is no. Although your work might last just three months, a client can make a claim in the future if some aspect of your advice or services causes them financial or reputational damage.
You are entitled to cancel your professional indemnity insurance when you finish a contract, but this will leave you exposed to potential claims. So, YES, you need ongoing cover to avoid potentially costly charges against you.
Retroactive insurance cover
Another popular question concerns ‘retroactive’ insurance. Sometimes, through lack of information or insufficient time, you might start working for a client without a policy in place.
You can still get cover; a professional indemnity policy can be arranged to cover work from a prior date if there are no claims pending. If this is the case, the insurance cover can be provided from the date when you began a contract.
Sometimes, not taking out professional indemnity will have been an oversight. Insurers can offer terms to cover work you have done before, with an retroactive date set prior to commencing the new policy. As you might expect, this will be reflected in the premium charged.
Don’t risk costly compensation claims
If you or a colleague have had to defend a negligence claim, you will know all too well that the process can be time consuming with potentially eye-watering costs. More than that, it can be a very worrying experience that impacts on other areas of your working and personal life.
Like so many aspects of business insurance, Professional Indemnity can be confusing. That’s why John Heath Insurance is here to help.
If you require any further advice about PI for your business, you can get a quote online at https://www.johnheath.com/get-quote/professional-indemnity/.
Alternatively, please call the John Heath team on 01270 252 252.
Posted by Jess Brown on May 29, 2018 in News, Professional Indemnity Insurance | Tagged Best PI insurance, business cover, Crewe business insurance, Indemnity for IT specialists, Professional Indemnity, Who needs professional indemnity | Leave a comment |