It is perfectly understandable that in an age of insurance for everything (public & employers’ liability, personal accident & sickness, health & safety), it can be tempting to leave professional indemnity insurance off the business’ shopping list. However, there are a couple of key reasons why you should seriously consider protection; firstly, to do business in the first place. Many potential customers/clients will not even consider offering your business a contract if you cannot provide evidence to show that you have professional indemnity insurance. Professional indemnity insurance not only protects your business and livelihood from financial ruin, but it also gives customers/clients peace of mind that if something were to go wrong in their dealings with you, they would be financially compensated for any loss.
The second and most important reason for getting professional indemnity insurance is that without it, you can pretty much say goodbye to your business and possibly your home in the event of a claim coming your way. Whether you actually did something wrong or whether you deny any wrongdoing, it will most likely cost you your business at least to prove your case and protect your reputation.
As anyone with business sense knows, a simple human mistake can be costly in financial terms for a client if it means they have had to cancel business contracts as a result of the mistake. This leaves an enormous bill at your doorstop. For the sake of small, manageable premiums, why not take away the risk of having such a bill landing your way. You cannot plan what claims may arise and how much they may cost you, but you can control what happens to your business and your livelihood afterwards. Get in the driving seat and take control over what would happen in the worst case scenario.
Not only would professional indemnity insurance foot the bill for both claims from third parties and legal expenses, but almost as important is the fact that you will not have to waste your precious business time dealing with the claim yourself, as your insurers will deal with this for you. The saying ‘prevention is better than a cure’ cannot be emphasised enough; except that in this case, refusing to have professional indemnity insurance may leave you no cure at all.