If you offer professional advice or services to your clients, then you will need professional indemnity insurance to protect you.
For a business in today's compensation culture, cover against legal action n is essential and can be compulsory for some professions, such as accountants.
With the appropriate professional indemnity insurance in place, you can not only rest assured that any legal action will be covered, but you can also afford to take your business forward by being more enterprising.
What to look for from professional indemnity insurance providers:
Excess: This is the amount you initially pay in the event of a claim. The higher your excess, the lower your premium, but opting to save money with a high excess could backfire in the event of a claim
Exclusions: Some insurers will refuse to cover complaints linked to employee dishonesty, computer malfunctions or lost documentation. Make sure you know what is included and excluded in your quote and request additional cover to override the exclusions, if you need the peace of mind
Expertise: A good insurer will provide you with a specialist lawyer in the event of a lawsuit. Removing the hassle of tracking down an attorney, this may be significant should a client have cause to claim against you
Geographical remit: Some insurers will not cover services or advice provided beyond the boundaries of the EU
Limit of indemnity: This is the maximum ceiling your insurer will pay out in the event of a claim. This will inevitably depend on the nature and size of your business and the extent of cover you would like, but can range from £50,000 to over £1 million
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This article was first published on Simply Business www.simplybusiness.co.uk