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What is Professional Indemnity Insurance?

If you are in a business or profession that provides advice or a service to clients then you should have Professional Indemnity Insurance (PII) which protects you against any claims made by dissatisfied clients.

That way if you are unlucky enough to find yourself in a dispute with a client, your Professional Indemnity Insurance policy will cover the cost of defending any allegations or claims that are made against you.

As a professional, you know the importance of protecting not only your reputation but also your business against the consequence of legal actions arising from your negligence or breach of professional duty or even as a result of just allegations of wrong doing.

Indeed for many professions such as Accountants, Solicitors, Surveyors, Insurance, Financial and medical professions (amongst many others) PII is compulsory and may be provided by their professional body. As an example, other businesses that should think about PII are :

  • Advertising Agents
  • Authors/Writers
  • Bookkeepers
  • Business Advisers/Consultants
  • Financial Analysts
  • Graphic Designers
  • Health & Safety Consultants
  • HR Consultants
  • IT Companies
  • IT Consultants
  • Management Consultants
  • Market Research Consultants
  • Marketing & Communications Consultants
  • Office Services
  • PR Consultants
  • Telecom Consultants
  • Training Consultants
  • Translators & Interpreters
  • Web Designers

Indeed, many of the above professions may find that is a condition of their contract with the client or at the very is a good idea to cover them from any possible problems with faulty code or advice.

What does Professional Indemnity Insurance Cover?

A Professional Indemnity Policy covers you against liability for loss caused to others arising from a professional mistake. Some policies are restricted to breaches of professional duty arising through 'negligence' but others are broader and refer to 'any civil liability', subject to certain exclusions. This cover can extend beyond negligence to:

  • contractual liability
  • breach of statutory duty
  • libel and slander
  • breach of copyright
  • breach of confidentially
  • breach of warranty of authority

How much does it cost?

As you might expect, Professional Indemnity premiums vary between professions for example, an environmental consultant will have to pay for more for their cover than a Marketing consultant for the same amount of cover. Premiums can start as low as £165 for £100,000 of cover in a low-risk profession. To get a quote for your business you should talk to an insurance broker that has experience in the PII field.


 
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