Professional indemnity insurance is an important form of Manteno business insurance. Essentially, it is designed to protect business owners and professionals against the negative financial effects of lawsuits and legal claims that may be filed against them. These usually result from negative consequences that arise from poor advice or service provided by the professional, making indemnity insurance crucial in industries like legal and medical.
In order to determine whether a business needs professional indemnity insurance, they simply need to ask themselves whether they offer a service or advice that could be potentially damaging to their client. For example, a professional who offers financial advice could be sued if their recommendations lead to financial ruin on the part of the client. An indemnity insurance policy will therefore help to cover them against the legal expenses that may result if claims are brought against them. If they end up having to pay damages as a result of a lawsuit, their policy will offer them a financial reprieve.
Any form of specialized advice has the potential to cause damage, particularly if taken in the wrong way, or if ill-used by the client. Legal, medical, and finance professionals should always maintain a high level of coverage. In addition, professionals who work in the health industry, as well as professionals like consultants and architects need to ensure that they are fully protected.
Indemnity policies can be taken out for both long term and short term periods. For example, an architect may only need a policy when they work on a specific project. Other professionals will need to cover themselves as part of their day to day work. When applying, it is important to provide details of the job at hand, as well as other elements such as information about clients, employees, and contractors. This will help a business of professional to achieve the most appropriate, and affordable, policy available to them.
Determining specific needs will also involve a discussion on how much coverage to get. Coverage amounts generally start at around $300,000, but will usually go a lot higher. Coverage needs will be determined by the sort of advice and services being offered, the industry the business operates in, and the forms of negligence claims that may be filed against them. Naturally, higher potential claims mean higher risk for the insurer, and this will lead to higher premiums.
Indemnity insurance is an essential cost of many businesses and professionals, and without it can lead to crippling legal costs and payouts. For more information on this form of insurance, and how to go about getting it, call HomeStar Insurance Services at 815-468-8763.