What You Should Know
Businesses value certainty above everything else with the exception of profit. Unfortunately, this world is quite uncertain. Anything can happen at any time and all you can do is to prepare for any eventual outcome. Many of the businesses that fail to prepare adequately especially in terms of getting the right kind of insurance close shop. An example of a critical type of insurance is professional indemnity insurance, which protects your business financially against claims of negligence or breach of duty. These claims can cost your business lots of money in terms of litigation fees, penalty fees, and lost business opportunities resulting from representational loss.
Who uses it
Some businesses need this type of insurance more than others do. They include management consultants, IT experts, recruitment agencies, and designers. Fitness professionals and teachers also need to prioritise this kind of insurance as they prepare their budgets for the year. Indemnity insurance is so important for these firms mentioned here that some companies and institutions would not business with them if they lack it. For example, a management consultant firm may get a contract to work with an industrial firm for five years yet the consultancy closes shop in the third year because of a negligence suit lodged against it. Additionally, the industrial firm would need to know that the consultancy could bear the costs of a negligence suit it can bring against the company if the business relationship fails.
It is important to note that having professional indemnity insurance shows your current and potential client that you are a serious firm. They would see that you understand the dynamics of business and as such, you have prepared for any eventuality. In fact, you might inspire them to get indemnity insurance for their business. These are the benefits of getting this type of insurance. You should get it as soon as possible because it will only cover negligence claims if the incident in question occurred after you got the claim.