What does a professional indemnity insurance policy cover?

The short answer is: it varies from policy to policy.

In broad terms, a professional indemnity (PI) policy will protect you from the financial consequences of an alleged breach in your professional duties – provided that breach was not intentional.

What PI protects

If someone with whom you have an actual or assumed contractual relationship believes you have done – or failed to do – something that has harmed their interests, they may pursue you for compensation.
Should this happen, professional indemnity insurance can protect you in a number of ways. A standard PI policy will fund your legal defence costs and any award subsequently made against you – up to the policy limit.

For example…

Examples of how such allegations can arise would include: a solicitor who misses the filing deadline for a law suit, an accountant who fails to identify fraud when auditing company accounts, an architect who wrongly specifies structural elements, or a surveyor wrongly valuing a property.
In each of these scenarios, it is easy to see that the client would have genuine grounds for grievance. But a PI policy will also protect you, even if a complaint or lawsuit is groundless.

The Devil is in the detail

Beyond these general outlines, however, PI policies vary widely in the coverage they offer. Some cover all contractual obligations. Others require that the alleged breach of professional duties constitutes a negligent failure to adhere to the standards expected of a member of your profession.
Available cover limits, deductibles, exclusions and extensions, vary greatly. The important thing is to ensure you select a policy that can cater for the true risks your business faces and that will provide the level of protection you need.

Getting the right PI advice

A specialist broker will be able to advise you on what cover is available to meet your specific requirements.
If you would like to know more about professional indemnity or other types of liability insurance, give us a call on 1890-399-399 to speak with an expert, or complete our online enquiry form.

Martin Insurance provides bespoke liability insurance cover for a range of clients in Construction, Contracting, Manufacturing, Waste, Leisure, Professional Services, Technology, Retail and Transport.This blog is provided for information purposes only. Every insurance policy contains detailed terms, conditions, warranties and exclusions. Full details of your policy cover will be contained in your policy documents.

This blog is provided for information purposes only. Every insurance policy contains detailed terms, conditions, warranties and exclusions. Full details of your policy cover will be contained in your policy documents.