• News
  • Columns
  • Interviews
  • BW Communities
  • Events
  • BW TV
  • Subscribe to Print
  • Editorial Calendar 19-20
BW Businessworld

Professional Indemnity Insurance: Insurance Policy That Every Professional Should Consider

Professional Indemnity Insurance better known as Professional Liability Insurance (PLI) is a form of professional insurance where all the liabilities of a professional in terms of their works are covered

Photo Credit : Shutterstock


Professional Indemnity Insurance better known as Professional Liability Insurance (PLI) is a form of professional insurance where all the liabilities of a professional in terms of their works are covered. If there is an error by the policy holder in regards to his or her profession this insurance will cover all the charges including the loss which is supposed to be covered by the defaulter. In a word, the insurer will pay on behalf of an insured all the losses resulting from any claim against an insured for a civil liability arising from an insured’s professional services.Here are some of the benefits which an insured can enjoy after getting a Professional Indemnity Insurance.

Features of Professional Indemnity Insurance

The terms and conditions, including the features of any of insurance is almost 100 pages long and thus takes a very long time to know all the features. No more going through a whole book, as here are some of the best features of that one must look for, while buying professional indemnity insurance.

  • Lawsuit protection: This is one of the best features of this insurance. This feature can come into play when a client of yours actually alleges you with something you have not done. In that case, if a case is filed against you will be supported with the help of this insurance. Apart from this, if a client files a case against you saying that he or she is unsatisfied with your service then the insurance can be well used for all the expenses which are to be incurred in the case.
  • Professional Negligence: When it comes to fighting the lawsuit for your profession, the policy comes very handy. There are common cases where a professional is charged by his client saying that he or she has neglected the client and thus caused hi severe damage.  Well in this case too, you can well use the insurance to cover all expenses for the lawsuit and the insurance itself will help you to get out of this trouble.
  • Expenses of the Lawyer: In case you need any lawyer for your profession, then the Professional Indemnity Insurance will cover his fees also, which is a great plus of this insurance.
  • Documentation: If the insured gets in trouble for any cause, all the documentation for that will be covered by this insurance itself.

These are some of the features of Professional Liability Insurance which are very important for every professional to safeguard their works.

However, if you are still wondering who can actually have this insurance, then here is the answer. Each and every professional can have this insurance to protect any sort loss in regards to their profession. However, below are some of the most common professionals who generally go for this insurance.

Who can get this Insurance?

As mentioned earlier, any professional can get insured with this insurance. Nevertheless, the below are some of the professionals who should definitely go for a Professional Indemnity Insurance.

  • Engineers
  • Architects
  • Graphic Designers
  • Interior Designer
  • Estate agents
  • Accountants
  • Legal Advisers and many more.

In a word, if your profession deals with knowledge, designing and advising you should get insurance. In a word, if there is any sort of responsibility for your clients, then there is a chance that you might need a Liability Insurance.

What does the Insurance covers?

While in doing the professional work in case of any legal liability, including injuries will be covered for

  • The Insured
  • Any Descendants of the insured (if covered by the insurance)
  • Or anyone who is entitled at the time of the insurance (in absence of the insured)

Apart from covering legal liabilities, the insurance also covers all the cost, fees and expenses while having a legal lawsuit.

What are the things which are not covered the Insurance? 

Just like any other insurances, this insurance also have some exclusions. Here are some of the exclusions which you might mind while going for the insurance.

  • If the insured is guilty or is involved in any sort of criminal activities.
  • If the insured is in state of drunk or under influence of any narcotics while rendering the service.
  • Nuclear and War threats.
  • Any issues in regards to copyright; trademark and patent.
  • Any issues rose by or in associations with AIDS.
  • If the insured is dishonest or has done frauds with any client.
  • Any legal liabilities before the date of commencement of the insurance.
  • Loss of assets like Goodwill, or market loss.

So, here is the detailed information about one of the most important insurances for all the professionals out there. Thus, it can be concluded that this insurance is a must have for each and every professionals who are providing services for their clients.

Disclaimer: The views expressed in the article above are those of the authors' and do not necessarily represent or reflect the views of this publishing house. Unless otherwise noted, the author is writing in his/her personal capacity. They are not intended and should not be thought to represent official ideas, attitudes, or policies of any agency or institution.

Tags assigned to this article:
insurance lawsuit liabilities

Harpreet Singh

THe authior is the Head General Insurance at Sridhar Insurance Brokers Pvt. Ltd. (SIB)

More From The Author >>