Do Small Businesses Need Professional Indemnity Insurance?
As a business owner, you’re likely to have heard the term “professional indemnity insurance” floating around. But what is professional indemnity insurance, and at what point do you need to get this type of cover for your business?
At Higos, we’re experts in finding commercial insurance for a huge array of businesses. We know how important it is to have tailored cover that’s right for you. In this blog, we’ll be discussing what professional indemnity cover is, and who needs it, particularly for small businesses.
What is Professional Indemnity Insurance?
Professional Indemnity Insurance refers to a type of cover that protects your business in the event of a claim made by clients or third parties in regards to “inadequate” or negligent service.
For example, if you run a consultancy and provide advice to a client that they deem was made in error, or was negligent, and it resulted in their making a claim, your level of PI Insurance would protect you.
So how does this affect your small business? First, let’s take a look at some of the common risks small businesses face and how these should impact your decision to choose small business professional indemnity insurance:
- Accidental loss or damage of documents or data
- Data protection breaches
- Unintentional breaches of confidentiality
- Breach of professional duty
- Libel or slander accusations
Each of these risks may sound catastrophic, and without the right cover they can be. As a small business, you don’t always have a panel of CEOs to go to when issues arise. By having the right professional indemnity cover in place, you can protect your business from the fallout of any of these events. For example, if a client’s data was accidentally lost or stolen, your small business professional indemnity insurance can help cover the costs in recovering these documents.
Without this type of cover, if any of the above were to happen, you could be at risk of hefty claims from your clients, as well as loss of sales if they were to share their experience with other potential customers.
Do I Need Professional Indemnity Insurance?
As a small business owner, you may be unsure of whether this type of insurance is the right choice for you. Really, this depends on what you’d prefer to be protected against, and how your business operates. Professional indemnity cover is not mandatory for businesses, so ultimately it’s up to you. However, here are a list of just a few of the most common industries in which having professional indemnity insurance can be most beneficial:
- Solicitors
- Accountants & bookkeepers
- Architects
- Financial advisers
- Surveyors
- Business consultants
- Recruitment consultants
- Interior designers
- Software developers or programmers
- Marketing professionals
- Advertising agencies
- Medical consultants
- Counsellors or therapists
- Freelancers
Generally, if you are dealing with client or customer personal data, safety, or finances, it’s best practice to have professional indemnity cover in place.
At Higos, we get to know you and your business inside and out. We’ll find out the risks you face and how best to protect against them, finding the best small business professional indemnity insurance for you. With our experienced team and professional relationships with the UK’s top insurers, we’re here to help. Just get in touch with us on 01454 285255 for a no-obligation quote, or to speak to one of our commercial team. For professional indemnity insurance, it has to be Higos.