Professional indemnity insurance

Professionals offering advice, supervision, design etc either on behalf of a company or independently, owe a duty of care to their clients. Broadly speaking, exercising duty of care consists in dispensing advice or providing services with an appropriate level of skill and expertise. However, in situations where the client maintains that duty of care to have been breached, an allegation of negligence may be made against the professional. Professional Indemnity (P.I.) insurance policies exist to provide cover for the financial consequences of negligence and are taken out for the professional’s own protection.

If an accusation of negligence is made, first of all the plaintiff has to prove that the professional is guilty; defending oneself against a claim, or even admitting to breach of duty of care, can be a lengthy and costly process. P.I. insurance supplies cover for such proceedings, and also any costs incurred by the plaintiff as a result of the negligence. P.I. insurance policies will have a set limit on the amount payable by the insurer and will only cover the insurance period detailed in the schedule, but are invaluable in offering professionals peace of mind in a world where increasing numbers of people are prepared to take legal action against individuals or companies.