Computer Training Professional Indemnity Insurance
No matter what sector of the IT industry you operate in you need to be protected by Professional Indemnity Insurance.
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Computer Training Professional Indemnity Insurance Policy Highlights
Why Do Computer Training Providers Need Professional Indemnity Insurance?
As a training, coaching or education professional, you’re used to providing expertise and advice across a range of areas for your clients. Your clients rely on you for your specialist knowledge, whether that be of subject matter, delivery techniques or assessment, and they may make decisions based on the professional advice you give.
As you provide a professional service to clients, you could be at risk of being challenged on the work you deliver. It could be a course you deliver that misses out a key part of a syllabus that students will be assessed on. Or training materials you circulate that reproduce without permission an extract from a book that is protected by copyright. If a client brings a claim against your business for compensation, you’ll want a professional indemnity insurance policy in place that defends and protects you.
What do Professional Indemnity Insurers look for?
The central question is what would be the immediate financial and other consequences if data is incorrect or a system fails or becomes unavailable for any period of time. A lot depends on the precise function of the software and what commercial application it is being used for.
The main areas that give rise to litigation against IT companies are:
- Failure of the software/system to do the job for which it was intended (fitness for purpose).
- Failure to deliver the system on time.
- Failure to deliver the system to budget.
These can give rise to three types of claims:
- Client withholds or claims for return of the purchase price/fees paid
- Direct financial loss arising from the negligence of the IT Company
- Consequential loss
Insurers’ first line of defence is the written contract between the insured and their client. Insurers will often ask to see the insured’s standard terms and conditions. If smaller IT firms are asked to sign onerous contracts with larger customers it is important for the insured to understand the extent of cover offered to meet these contractual liabilities. Whilst cover for the first two types of claims mentioned above are available in the market, insurers expect that consequential losses will be excluded by the insured in their contract terms and conditions, or at least limited.
The prime underwriting criteria is of course what kinds of systems an IT professional is involved in. Areas that must always be disclosed to insurers include:
- Systems in the financial sector
- Games development
- Trading systems
- Process control systems
- ASPs (Application Services Provider) or ISPs (Internet Services Providers)
- Managed Service Providers
- Enterprise Resource Planners
- Large contract sizes
- Mission and safety critical systems
- Cases with US exposure