Professional Indemnity Insurance, also called PII or PI, is a kind of insurance cover that aims to protect professionals from compensation claims made by business clients. If you commit a mistake unintentionally when practicing the profession and it leads to damage to property and life, having a PII in place can protect your business.
Professionals who provide services, or any kind of product to their clients, do so with good intention, but sometimes it may so happen that the client may be dissatisfied or an employee may commit a mistake. In such cases, if the client files a legal proceeding against the business, it’s highly valuable to possess a PII. Different kinds of business have different requirements. For instance, a consumer product manufacturer will require a different type of protection when compared to a construction company. PII policies can be customized to meet the specific business needs, so it’s not difficult to find a policy that suits your specific requirements. Taking into consideration that your business is protected and you can also get a customized policy to meet your business requirements, it’s important that you consider buying a PII for your business.
A PII policy will cover all kinds of legal expenses that your business may incur and also the payouts to be made when there’s a legal proceeding filed by a client. The other benefit is that it will pay for settling a potential court case or claim out of court. This is highly advantageous since it is better that the reputation of your business isn’t at stake because of going to the court.
Next, PII will not only cover your business, but also your employees for negligence. This includes civil liability (contract breach or payments not made), duty breach, and infringement (damage or loss of your client’s data and records or any intellectual property infringement). In all of these cases, your client could sue you and this could result in vast financial expenditures and reputation loss.
If it’s unavoidable to go to court and your employee or business is wrongly accused, PII policy may let you hire professional defense lawyers to ensure that you win the lawsuit. This way, you will be safeguarded from legal liability. Many business owners feel that professional indemnity insurance is a costly affair, but it’s negligible when compared to the compensation claims that you could end up paying out. So, it’s high time you consider availing one for your business.