“If you own a business, you can be liable for damages or injuries to another person or property … consider [professional indemnity insurance] for your business if the likelihood of legal action is high.”
Australian Government, Business.gov.au
Anyone can make a mistake - but if your business if found liable for negligence, the costs can be financially devastating. Not only can it lead to an expensive lawsuit, but your business’ hard earned reputation may be damaged as a result.
That’s why professional indemnity insurance matters - help protecting you assets and brand if your advice or insurance cause a client to take legal action against you.
Professional indemnity insurance is mandatory in some industries, such as medicine, accounting, law and financial advisors - with the requirements differing from state to state.
But even in cases where it’s not required by law, it’s recommended for anyone who is providing professional services or advice in exchange for a fee - like, graphic designers, IT consultants and more. And regardless of your legal obligation, it’s often a customer requirement that you have this cover in place.
As a wide-ranging insurance solution, professional indemnity cover may include anything from accidents to errors and omissions. Depending on your policy, professional indemnity insurance can cover:
Civil liability - Civil liability to a third party arising out of the conduct of their professional business
Inquiry Costs - The cost of defending an inquiry by a regulatory body into the professional conduct of the insured
Defence Costs - The costs involved in defending a claim triggered by the policy
Fidelity Cover - Direct financial loss of the business caused by the dishonest or fraudulent conduct of an employee which is first discovered during the period of insurance
Advancement of Costs and Expenses - Additional costs and expenses incurred during a claim Expenses
Exclusions, the excess you need to pay and limits of liability can vary greatly depending on your insurer. Policies generally won’t include cover for:
Contractual or Commercial Liabilities
Liability which results from Fraud and Dishonesty
Depending on your occupation, Third Party Bodily Injury/Property Damage
This information is provided to assist you in understanding the terms, implications and common considerations in professional indemnity insurance. It does not constitute advice, and is not complete, so please discuss the full details with your Tudor insurance broker.
Did you know that what is actually covered can vary considerably between insurers? Often with exclusions or high excess payments that you may not be aware of. You need a broker who can assess your individual situation, offer the right insurance and explain precisely what is and isn’t covered.
It's easy to pay too much for insurance, but it's just as easy to pay too little then find out too late that you're not covered. There's a lot of flashy online insurance calculators out there but they focus only on price. Talk to Tudor and you talk to a real person who knows the what level of cover should be recommended and who will personally help you with a claim.
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