Most new businesses are extremely busy, balancing the need to secure new clients with all of the red tape required to run a modern business. These time pressures make it easy to overlook the importance of having the right insurance. It is common to think of insurance as just being there to protect against an event such as a fire or flood but for many, claims arising due to problems with work you have done for a client may be more likely.
What is professional indemnity insurance?
Professional indemnity insurance will offer cover for compensation you may need to pay to correct a mistake or cover legal costs due to alleged negligence, such as giving incorrect advice or making a mistake in work.
The policy will not only cover you for negligence but will also protect you from the following:
Creating and maintaining relationships with customers is key to success in any small business and ensuring you have the appropriate insurance in place will enable you to put right any mistakes that you may have made. Without professional indemnity insurance, you could be on the receiving end of expensive legal costs or the backlash from customers, along with compensation pay-outs.
Who needs professional indemnity insurance?
If you’re in an industry that provides advice to your clients, handle their data or provide a professional service, professional indemnity insurance could provide you with the protection you need. There are a number of policies available and in many instances you will be able to find one specifically tailored to risks associated within your area of operation.
Unfortunately any business is vulnerable to a claim of negligence and the associated financial loss could have a particularly detrimental effect on a small business. Covering your business will allow it to fulfill its potential and limit the financial impact of a claim.