It’s an unfortunate fact that the threat of claims and litigation is very real in today’s business environment. Even worse, a claim could potentially bankrupt your business.
Let’s look at an example. Picture this. You’re a construction professional engaged to provide advice about how much building materials will cost for a planned residential development. You provide the advice to your client, who then relies on it to gain finance to fund the development.
Unfortunately, the cost of building materials ends up being substantially more than you advised. The client now can’t afford to finish building the development and faces financial ruin, so they take legal action against you to recoup the shortfall.
It’s a pretty grim scenario, isn’t it? Can you afford to defend the claim?
Make sure you have the right cover
You’ve worked hard to build your business, so you need to make sure it’s protected. And that’s where professional indemnity insurance comes in.
Professional indemnity insurance is designed for professionals who provide advice or services. If you make a mistake in the course of your work that results in financial loss or injury to one of your clients, that client may take legal action against you to recover their loss. Professional indemnity insurance seeks to protect both your assets and your reputation in the event this occurs.
Defending yourself against a claim can be costly, both in time and money. It could also damage your reputation, irrespective of whether the allegations are founded or not. And you could also be held responsible not only for your own actions, but also for those of your partners, employees and volunteers.
With so much at stake, you can’t afford to leave anything to chance when it comes to professional indemnity insurance.
Not all professional indemnity insurance policies are the same, so it’s not just a case of jumping online and buying an off-the-shelf insurance solution. Just because a policy is labelled as a professional indemnity insurance policy doesn’t mean it’s going to provide the coverage your business needs.
Lots of policies carry a myriad of exclusions, so you won’t be covered for many of the most common claims. You may not even even realise that you’re not covered until it’s too late and a claim is made against you. Let’s face it, there’s no point having professional indemnity insurance if it doesn’t cover your business circumstances and, in particular, the specific risks you carry.
Having the wrong policy could be as bad as having no policy at all. That’s why it’s so important to seek professional advice from a specialist SME insurance broker who will take the time to understand you and your business, identify what the risks are and then find the right professional indemnity insurance solution for you.
Emjay Insurance Brokers are professional indemnity insurance experts and can provide you with the right advice. With access to a wide range of policies, they can tailor a solution to suit your unique needs. Contact us today to discuss your needs on (02) 9796 0400.