The growing needs of emerging businesses have necessitated the creation of a lot of insurance types under business or commercial insurance domain. The providers respond to the robust needs of businesses by marketing some innovative kinds of cover that can benefit businesses. Professional indemnity insurance is one such business insurance Calgary policy your business can buy. Here is what you need to know about this commercial insurance category and what it covers and does not cover.
The purpose of professional indemnity insurance
The purpose of professional indemnity insurance is to protect businesses and professionals providing services to their clients and customers against different kinds of legal liabilities that they might face in their operations. This insurance covers the cost of damages caused on account of negligence, breach of the professional contract terms, failure of duty due to an act of employee, errors and omissions done -0 which can all result in a significant monetary loss or damage to the clients.
Why buy professional liability insurance
Your business will need to consider professional liability insurance under several situations. This insurance plan can protect against highly expensive lawsuits from third parties for the mistakes, servicescould not be delivered or acts of negligence that has impacted the services offered.
As part of complying with several contract terms and requirements, professional indemnity insurance is a must for several types of businesses. Our times are seeing a sharp increase in the use of third party contractual staffing for the purpose of adhering to the time-lines of projects. Such situations will increase the chances of negligence, lack of coordination and skilled workmanship which can all impact the services the company delivers its customers.
Under these situations, a professional indemnity insurance can protect the business by covering the cost of lawsuits and compensation to the third parties.
Who can benefit from a Professional Indemnity Insurance cover?
Businesses engaged in selling their professional services to their clients including advertising agencies, market research firms, property management and others will need this kind of insurance protection. Professionals involved in architecture, accounting, consulting and engineering can find this insurance useful. Technological companies connected to infrastructure management services, system integration, research and development, software development and maintenance, business process outsourcing, data center services, and infrastructure engineering are the ones that can buy a professional indemnity insurance plan.
Professional Indemnity insurance policy can cover the employees, professionals, partners and the enterprise or its partnerships for the damages caused while providing or due to failure of providing their professional services. Damages will mean monetary loss that the client suffers on account of the services the company delivered.
A professional indemnity insurance will cover the costs of judgment and settlement charges, attorney fees, and legal representation costs incurred on account of investigation and having to defend the claim.
What the policy does not cover?
This policy will not cover any criminal act or acts that result from violation of laws. It will also not cover frauds, dishonesty, and malicious acts. The other aspects it will not cover include bodily injury, fines and penalties, war risks, any guarantees given in writing or made verbally in relation to the professional services offered and the claims related to workmanship compensation.