Professional Indemnity Insurance / Errors & Omission Liability Insurance

Q1. What is Professional Indemnity (PI) Insurance?

Professionals Indemnity is for professional such as: – architects, engineers, doctors, lawyers, chartered accountants, and medical practitioners, and services such as medical establishments need to protect their business interests. The policy is also known as Errors and Omission (E&O) Liability insurance, and typically taken by services companies e.g., Software development. This type of insurance is available to cover the costs and expenses of defending a legal claim and any damages payable.

PI insurance policies typically will cover the following:

The entity, including any subsidiaries (held or acquired during the policy period);

Q2. What is covered under Professional Indemnity Policy?

PI insurance provides cover for losses sustained by third parties as a result of a breach of your professional duty.
This is commonly referred to as Professional Liability. In addition, policies typically cover:
1. Misleading and Deceptive conduct
2. Defamation i.e the communication of a false statement that harms the reputation of an individual, business, product, group, government.
3. Breach of Intellectual Property Rights
4. Damages arising from Fraud/Dishonesty of employees
5. Defense Costs associated with covered claims etc.

Q3. What are the Extension under Professional Indemnity Insurance?

1. Fines and Awards– by Dispute Resolution Bodies/ Investigations Costs;
2. Lost Documents – for damaged or lost documents that are part of providing professional services;
3. Previous Business – for when persons now providing professional services to another organization
4. Continuous cover – provides cover in certain situations for known circumstances arising prior to the period of insurance, as long as the insured was continuously insured with the same insurer and was insured at the time they first became aware of the known circumstance.

Q4.What are the Exclusions under Professional Indemnity Insurance?

1. Any criminal act or any act committed in violation of any law or ordinance
2. Services rendered while under the influence of intoxicants or narcotics
3. Any third party public liability
4. Any condition caused by or associated with AIDS
5. Rising out of all personal injuries such as libel, slander or false arrest.
6. Infringement of plans, copy-right, patent, trade name, trade mark, registered design
7. Deliberate, willful or intentional noncompliance of any statutory provision.
8. Fines, penalties, punitive or exemplary damages.
9. Professional services rendered by the Insured prior to the Retroactive Date in the Schedule.
10. War and nuclear perils etc.

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