Why Do I Need Professional Indemnity Insurance?

All businesses aim to minimise the risks to their profitability but it is not possible to safeguard against every possible eventuality that the business may encounter. This is particularly true for professional services partly because of the often more complex nature of the advice, guidance and tasks that they are providing for their clients.

Mistakes can be made or advice can prove misleading, resulting in financial loss or business injury for a client. This is true whether you are a sole trader or have a number of employees in the business working for you. An injured client may make a claim against your business for compensation for their losses arising as a result.

Responding to claims can be financially crippling for a business. Those who are un-insured may simply be unable to pay. For this reason professionals such as financial advisors are legally required to have professional indemnity insurance to protect the interests of the general public.

Any business which provides a professional service would benefit from having similar insurance cover from a company like Endsleigh-Business.co.uk and potential clients will be reassured that if anything does go wrong your business is financially capable of putting things right. Professional indemnity (PI) insurance is specifically designed for professional services businesses and insurers are generally experts within this field.

This is essential back up for you and your business to help ensure that you are not held liable for any false or unreasonable claims. It is also worth considering that in some cases PR or marketing activity may be needed to restore confidence in your business after a claim has been made.

This too has a cost, quite separate from the legal aspects, so having as much financial support for the legal and compensation expenses of a claim as possible is critical for the continued success of your business.