Different Uses of a Professional Indemnity Insurance

A professional indemnity insurance policy is the key instrument that helps practicing professionals to enjoy their working without worrying about third-party claims. In fact, PI insurance policy can be utilized in many different ways to protect professionals from paying a hefty sum of money to clients as a result of an alleged error.

Professionals are eligible for getting coverage when a mistake is made in their professional service and it has further led to disputes between both the service provider and the client. If the dispute becomes complicated, a professional insurance policy will pay for defending a professional’s claims and thus, save his/her career.

An insurance policy is needed most while fixing a mistake, which has happened during delivering services to the client, in order to avoid any further claim. Usually, a professional indemnity insurance policy is used to minimize the trouble between both the parties. Also, a policy pays damages when a professional happens to lose confidential data/documents while providing his/her best possible services.

What PI insurance policies cover?

PI insurance policies or professional indemnity insurance policies provide coverage for the claims against the policy holders in case of their professional negligence or errors.

PI insurance policy protects the policy holders against their negligent acts, errors or omissions, breach of duties and also civil liabilities that may have led to damages to their clients.

Some of the PI insurance policies also cover breach of contract, slander and libel, unintentionally infringement of other’s copyrights, broadcasting rights and trademarks. The insurance coverage also engulfs damages caused due to loss or stealing of data or documents that belong to their clients, thus breaching their privacy and confidentiality.

PI insurance should be taken by professionals who provide advisory or consultancy services to their clients. Some of the industries in which purchasing a PI insurance policy is most popular and necessary include financial and accounting services, consultation services, information technology, medical services and legal services.