Professional Indemnity Insurance is very much an insurance product for professionals. If the clue didn't first surface with the name, then surely its detailed professional, business specification made you realise this. Quite recently I read that when starting out in business ownership, especially concerning those becoming self-employed, the purchase of professional indemnity insurance is very much that first step into becoming a fully-fledged business enterprise. When entering the world of business, we as professionals are stepping into a connected web of finances, legislations and agreements that make up a community of successful and self-sustaining companies.
Because there is a vast amount of regulation within business, and it isn't simply flogging the next big thing from the back of a van (as much as Del Boy would disagree) certain business insurances must be put in place for proper enterprise to commence. So yes, professional indemnity insurance is a very important step when venturing out into self-managed business and it is interesting to witness just how important such a common form of cover can be.
Professional Indemnity Insurance is an aspect of small business insurance that covers the policy holder against any claims that may be made due to professional malpractice. It's a type of insurance that applies particularly to those working as sole traders, contractors and freelancers being ideal examples and it is relevant across a vast range of sectors. From IT contractors to architects, the inclusion of such a policy is highly effective, as professional error can occur at any time and within any trade.
Every business, large or small strives for success (if yours doesn't then I seriously advise that you re-think your business strategy). Because of this, companies must network and connect with clients and partners, obviously landing work whenever possible. As businesses do grow and intertwine within the commercial market, the higher the risk of potential claims becomes, as one is increasingly left open to legal issues.
The business environment in the modern day is rife with claims and counter claims, the number of 'no win no fee' soliciting services being practically shoved down our throats whenever we turn on our televisions. Of course in a growing market, legal issues exist, but often instead of opting for expensive and complicated legal involvement, a practical insurance policy will suffice. Business Insurance is designed to cover a company against all of those additional pitfalls of owning a business, and contractor insurance for example acts in very much the same way.
Professional indemnity insurance as a contractor insurance policy is highly effective, as being businesses in their own account contractors need an existing cover to protect their professional indemnity and finances. Obviously a cover such as this is better than paying beyond the odds for legal advisors, and professional indemnity insurance benefits limited company contractors in a large number of ways as opposed to simply protecting their potential professional error.
