Trials and Errors

Business, like life, doesn't always go to plan. No matter how well managed your company is, things can sometimes still go wrong. Even the most reputable company can find itself in a dispute with a client over a mistake. How can you protect the business you have worked so hard to build up?

Professional Indemnity insurance covers your business in the event that legal action is taken against you by a client, who may claim to have suffered a financial loss as a result of advice or work you have given or undertaken in a professional capacity.

A 'professional' is generally regarded as any person who offers specialist advice, design specification or other professional services.  This can include designers, consultants, advertising agents, translators and private investigators amongst others, as well as the more 'traditional' professions such as accountants, surveyors and solicitors.

What could go wrong?  Here are some examples of where professional indemnity insurance could protect your business.

Funeral Director

A funeral director forgets to remove the rings from a dead client who is subsequently cremated. Cost £25,000.

Safety Consultant

A man is injured when he falls from scaffolding approved by the insured. Cost £75,000.

Landscape Architect

The insured designed a pond on a golf course which was not water-tight.  The client sues for the cost of lining.  Cost £30,000.

Advertising Agent

A commercial shown on television uses the wrong soundtrack.  Cost £100,000.

Graphic Designer

A text book drawing is adapted to use as a logo. A third party sues for breach of copyright.  Cost £35,000.

Estate Agent

It is alleged that the insured undersells a property.  Five months later, the property is resold for double the previous price.  Cost £200,000.

Public Relations Consultant

Advertising literature produced by the insured contains an error that is discovered after all the copies have been printed.  This results in a claim for reprinting costs.  Cost £67,000.

Interior Designer

The insured designs the layout of office premises.  The client alleges that this was not in accordance with his requirements.  Cost £25,000.

Travel Agent

The insured fails to arrange travel insurance for a client who fall ill on holiday in Africa.  Cost £10,000.

All of the above are examples of where professional indemnity insurance can protect you and your business against financial claims.

In today's increasingly litigious society, it pays to be protected.

Last reviewed 7/11/2011

To talk to an expert in your area and get a quote, contact your local insurance broker.