Professional indemnity (PI) insurance is coverage that offers protection if you’re held responsible for causing financial loss to your client due to mistakes or errors in the services you have provided. Having PI in place allows you to deliver your services with confidence, and also provides reassurance for the client. It’s impossible to predict when and why a client will make a claim against you, but PI insurance is there to cover legal costs and expenses involved in defending the claim, as well as any compensation payable.
Mistakes can happen in any business sector and PI insurance should cover the relevant risks. We’ll outline some common industries in which it’s advised to take out PI insurance.
Construction Professionals
Professionals in the construction industry are advised to take out PI insurance in case a claim is made against them by a client. Reasons for this could be poor designs, use of improper materials, a mistake in a project build or negligence. Any of these could potentially result in a financial loss to a client. Taking out PI insurance for construction will cover compensation and legal costs if a claim arises.
Designers
All types of designers – including graphic, illustrative, architectural, web and game – are advised to get PI insurance. Copyright can be a risk for many designers but PI insurance is there to help defend any claim and cover any compensation payable.
Self-employed and freelance designers should consider the possibility that their personal financial situation could suffer in event a claim is brought against them. A claim could be in relation to errors in contracts or agreements. PI is therefore particularly important to help support the defence of a claim as well as any compensation owed to the client.
Surveyors
A surveyor’s job is to assess a property’s suitability and clients rely on this information to make decisions regarding buying houses, buildings, and developments. If an issue with the property has been overlooked or not taken into consideration, this can have a huge financial impact on a client. There are risks across all aspects of surveying, including project and property management, design, surveys, valuations, and planning.
PI insurance protects those who give such advice and covers any costs or damages resulting from a negligence claim.
Solicitors
If a solicitor gives the wrong advice, a client can be faced with large financial losses and could make a negligence claim. These can be costly but PI insurance can protect the business should this occur. As with other professions, legal costs as well as compensation are usually covered by this type of insurance.
Whatever industry a professional works across, it’s advisable to take out PI insurance, especially where expert advice or services are involved. Mistakes can and do happen so it’s important for a business to be protected should a claim be made.
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