A few months ago, a police case was filed against the doctor at Gorakhpur’s BRD Medical College with an attempt to murder over the death of over 20 children at the health facility. It’s human nature to make mistakes. However, not all mistakes are forgivable, especially if someone has incurred losses by acting upon your advice or service. In today’s ever-growing business culture, the simplest slip can prove expensive, and the threat of litigation can wreak havoc both your funds and reputation.
It’s not only the medical field where legal cases have piled up. In fact, other professionals, like interior designers, lawyers, chartered accountants, etc.; are also facing the brunt. Take this case: In 2015, a case was filed against the interior designer in Chandigarh by two residents who sued him for not completing the work within the deadline.
In those professionals where you impart service or advice to others, you always run the risk of being sued by the other party. In such cases, a legal suit can be filed against you by your client who may ask for compensation as well. This is where professional indemnity insurance can come to your rescue.
Also called, errors & omissions (E&O) insurance policy, the professional indemnity insurance safeguards you against liabilities which may arise from negligent services or advice given by you. Thus, it helps you protect your company’s reputation and give you the freedom to run your business with zeal and confidence.
Understanding the Professional Indemnity Insurance
E&O insurance policy gives ‘indemnity’ if a company or its professional commits an error and thus, the policy covers the legal expenses which a person may have to pay to defend itself in the court. And, if the verdict goes against the policyholder, the insurer also pays compensation to the plaintiff.
A professional indemnity insurance policy works wonders by safeguarding professionals against a myriad of risks or loss which could arise due to professional negligence, loss of documents or unintentional breach of copyright, etc.
Significance of Professional Indemnity Insurance
Usually, businesses can be sued for the mistakes which they make. If a client files a legal suit, the company or professional could suffer and might find it daunting to recover them, which makes it essential to buy errors and omissions insurance policy. Thanks to the policy, professionals can give services to their clients without worrying about the possibility of errors. The following benefits of professional indemnity insurance make it a must-have cover:
- Cut Risk: You do not have to worry about paying for legal cases from your pocket for unintentional errors you make. The policy helps professionals to pursue their business without fretting about the cost of potential claims.
- Build Trust: In certain situations, E&O insurance policy also acts as a viable marketing tool. Clients know that if you make a mistake, you will take adequate measures to fix it. Having professional indemnity insurance in place will give assurance to your customers that you will take the complete responsibility for your business in case of any error. Thus, it will help you win their trust as well.
A Quick Glance At the Benefits of Professional Indemnity Insurance:
- Comprehensive coverage to cover various types of risks and losses
- Wide protection against legal expenses
- Hassle-free documentation
- Option to increase or decrease the sum insured as per your needs
- Flexibility to customise insurance policy
- Expert support
Who Should Go for Professional Indemnity Insurance?
Apart from big companies, professional indemnity insurance should be purchased by individual professionals, like engineers, doctors, lawyers, etc. Anyone who imparts services or advice to its clients should think of buying professional indemnity insurance.
The Final Verdict
The success of your business is the result of your hard work and determination. It is unwise to assume that mistakes will not happen in your business. Therefore, securing it with the professional indemnity insurance is the need of the hour.
Once you have understood the importance of professional indemnity insurance, we can say it confidently: “Yes, professional indemnity insurance worth it”!