21 Apr 2020

Professional Indemnity Insurance - Do You Need It?

Insurance
Professional Indemnity Insurance - Do You Need  It?


As a part of our partnership with Austbrokers Countrywide - our preferred provider of Insurance and Financial Services, we are able to offer AIPM members Professional Indemnity Insurance. So we’ve created a quick overview of what it is and why it’s beneficial for Project Managers.


WHAT IS PROFESSIONAL INDEMNITY INSURANCE? 

Professional Indemnity Insurance is protection for any kind of professional who provides a service for a fee. If you run your own project management consultancy business, you may be liable for damages to another organisation or person caused by your business. You could face claims of negligence or breach of duty in providing professional advice or services that led to financial loss, injury or damage. 

Professional Indemnity Insurance is designed to protect your company’s position and assets in the event of a claim, so you can continue to operate. If a claim is found to be without merit, Professional Indemnity Insurance will pay for the business’ legal costs. If the business is found to be at fault then it also covers settlement costs.

You might ask - is this not the same as Public Liability Insurance? Public Liability Insurance protects you and your business against bodily injury and property damage arising out of your negligence, such as someone slipping over in your office. Professional Indemnity Insurance, on the other hand, protects you and your business against allegations of negligence or breach of duty that arise from an action, error or omission on your part while carrying out professional services.

 

WHAT ARE THE BENEFITS?

In today’s business world the threat of claims or litigation is a real consideration and can bankrupt businesses both small and large. Here’s a quick summary of the key benefits of Professional Indemnity Insurance:

  • Protects a business from the unknown: small businesses, in particular, are vulnerable to unexpected and unplanned events. Professional Indemnity Insurance can help a small business be in a better position to cover the expensive lawsuit costs without impacting the business. 

  • Gives you access to professional assistance. You will save time and reduce stress knowing you have experienced legal professionals taking care of any claims or allegations made against you. Insurers also negotiate set rates so the legal bill will be lower than if you tried to manage it on your own.

  • Professional Indemnity Insurance shows professionalism. Having this kind of cover shows you are a serious business equipped to back up the quality of your work. Showing you have cover can be the difference between winning or losing new business. 

  • Successful tendering. Many contracts for either panel consultants or individual bodies of work require appropriate insurance just to begin work, so having the appropriate protection in place also ensures you are eligible to pick up these contracts.

 

IS PROFESSIONAL INDEMNITY INSURANCE RIGHT FOR YOU?

If you are running your own project management consultancy - it’s worth considering Professional Indemnity Insurance. If you are an AIPM member - we recommend that you talk to the experts at Austbrokers Countrywide. They specialise in advising consulting professionals. AIPM members can access 14 months of cover through their Professional Indemnity and Public Liability facility for the price of 12 months.

Austbrokers Countrywide can also help you with a range of other insurance and financial advice needs including Public Liability Insurance, Income Protection, Life & Trauma Insurance, Office Insurance and Corporate Travel Insurance. They also can assist with a range of general financial advice needs. You can learn more here.


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