Professional Indemnity Insurance Cover

If you’re in the market for professional indemnity insurance cover, you’ll want  to be certain that the policy you opt for really is the best one for you and your business. And to be sure of that, you’ll need to consider a few key points.

To start with, what is the risk you’re trying to cover? Fundamentally, it’s the risk of being sued for negligence, for failing to exercise an appropriate level of professional care. But in order for your professional indemnity insurance cover to apply, the precise nature of your profession will need to be defined in the policy. It’s one of the key characteristics of professional indemnity insurance that it is always profession-specific – for the simple reason that the risk of being sued for one type of profession is far greater than for another.

You should also look out for any policy exclusions that might limit the extent of your professional indemnity cover. One particular exclusion you should be aware of is common to just about every professional indemnity policy and it relates to territory, in other words where you work. In some parts of the world, notably the United States, the risk of legal action being taken against professionals is significantly higher than elsewhere and the likely size of claim is also potentially far greater. So, if you work for clients outside of the UK, it is very important that you check whether a particular policy will provide you with the necessary professional indemnity insurance cover.

Another critical question is the amount of professional indemnity insurance cover you should have. As you would expect, the higher the policy limit the higher the premium is going to be. And whilst it might be tempting to opt for a low limit in order to save money, doing so could turn out to be a potentially devastating false economy. Once again, the appropriate limit depends on the nature of the work you undertake and the nature of the clients you undertake it for. If you only ever work for small businesses in your local area, a lower limit may be sufficient. But if you ever work for multinationals engaged in £multi-million projects – where a small mistake on your part could have massive financial consequences – then a lower limit most definitely won’t be.

Finally, there’s the question of the policy excess. If the premium you’re quoted seems surprisingly cheap, it could be because the excess is particularly high. Now, you may quite reasonably decide that the is the right balance for you. But it’s important to check. Otherwise, if you have to make a claim, you might discover too late that your professional indemnity insurance cover does not extend as far as you thought it did.

Bear all the above points in mind and you should have no problem finding the professional indemnity insurance cover that’s right for you.