Professional Indemnity Insurance

Professional indemnity insurance is important for all whomever engaged in selling their professional knowledge and expert opinions. Anyone from accountants, lawyers, doctors, creative people, artists, freelancers, IT professionals, managers to scientists – professional indemnity protects everyone. In fact, countries like UK and Australia have strict laws that require a professional to have a indemnity insurance policy before start practicing as a full-time professional.

The insurance policy provides financial protection to professionals against any kind of a third party claim for loss or damage caused to clients by availing professional services. Besides providing claims for potential claims like negligence, errors, omissions, insurers also provide indemnity for a variety of other reasons as well. Some of the important reasons involve breach of contract, client dissatisfaction, financial damages by a client and such others.

Professional Indemnity

Professional Indemnity insurance protects freelance contractors against unforeseen circumstances, such as claims made by dissatisfied customers. Built especially for contractors, who are the softest targets of dissatisfaction, professional indemnity insurance is expediently planned or devised to cover damages that have the potentiality of being payable. Contractors simply need to take a policy, pay premium, and stay protected.

Professional indemnity is quite popular nowadays because lot is known about its advantages. Earlier, it used to be believed that professional indemnity instance covers are very expensive, a reason why many contractors are scared away. However, a little insight into the real aspects shows the truth. PI insurance can be easily obtained by providing information about yearly income, nature of business, nature of working. As a freelance contractor, you can claim Professional Indemnity (PI) as a 'Schedule E' expense in addition to the usual 5% allowance, making Professional Indemnity insurance the most popular scheme for freelancer contractors.

Professional Liability Insurance

Professional liability insurance, also known as the Professional Indemnity Insurance, provides coverage to professional individuals such as accounts, lawyers, architects, doctors, pharmacists and nurses against any negligence claims made by their respective clients or patients. Depending on the profession of an individual, the Professional Liability Insurance takes on different names. For example, the Professional Liability Insurance for the notary public is called the Errors and Omissions Insurance (E&O). The Errors and Omission Insurance policies also provide coverage to the technological companies such as the technology consultants, technology creators and software developers. The chief coverage provided by the E&O policies is the financial loss of the client, failure to perform, breach of warranty and personal injury.

A normal general liability insurance plan will provide coverage to the claims such as property damage, advertising injury, personal injury or bodily injury whereas a Professional Liability Insurance not only covers all the aforementioned claims but also claims such as the violation of good fair and faith dealing, inaccurate advice, misinterpretation and negligence. However, the Professional Liability Insurance covers the incidents that took place when the insurance coverage is active.