If you provide professional services or advice for a fee, you need to ensure your business is covered by Professional Indemnity (PI) insurance.
This includes any consultants, contractors, counsellors or financial services providers (for example planners, accountants and bookkeepers), real estate agent or valuers, management consultants, IT contractors and recruitment consultants – as well as the more traditional professionals like lawyers, architects, health practitioners, advisers and brokers.
What is PI?
PI is a type of indemnity insurance. It provides crucial and often mandated by professional associations or contracts of engagement financial protection in case of client claims for negligence and/or errors and/or omissions. (Basically insurance for the advice you provide) In these cases, the insurance will cover costs such as legal fees and damages awarded to claimants.
Some examples of the events covered in a typical PI policy include incorrect advice, errors and contract breaches – as long as these events were unintentional and not in any way deliberate.
The risk of not having PI cover
Without cover for these types of claims, you could risk reputational loss or losing your business assets that you’ve worked so hard to build as a result of expensive lawsuits.
If you offer professional services to your clients, you really need to ensure you have adequate PI Insurance to cover you for the risks your business carries. To find out more about PI insurance, get in touch with your local Reliance partner.