Professional indemnity insurance is not a legal requirement for business but is mandatory in some industries, such as medicine, accounting, law and financial advisers and it is recommended for anyone who is providing professional services or advice in exchange for a fee – like engineers, graphic designers, or IT consultants.
The amount of cover your business needs will depend on the nature of your work and the type of clients you service. If you work with large organisations in heavily regulated industries, then your professional indemnity requirements are likely to be higher.
There are often exclusions, deductibles and limits which apply, so contact an Avoca Insurance Broker to discuss your specific insurance needs.
Other professions who provide advice or a professional service and should consider taking out a professional indemnity policy.
Insurers can look to limit their exposure to consequential financial loss by limiting claims to rectification costs only and excluding consequential losses such as:
Claims from consequential financial loss are costly for insurers to defend and are often difficult to value or rate by usual methods.
The occupations that have the highest exposure to consequential financial loss include those involved in, or providing services to, products, commodities or supply chains as they often include loss from business interruption, downtime or accumulation exposures, and include:
Insureds can look to limit their exposure to consequential loss in a few ways:
Ensure they review the contracts they sign or get independent legal advice to ensure they are not picking up any unexpected or assumed liability under the contract
