Professional indemnity insurance, also known as professional liability insurance, is basically a cover that businesses or individuals receive in response to claims against them. Basically, all those businesses that are involved in providing advice to their clients or providing services for them must look forward to indemnity insurance. Any damages or cost that have impacted your customers financially or they have lost any money against your advice, then they might file a complaint against you asking remuneration for their lost money. A professional indemnity insurance will make sure you are covered up and compensated against legal costs.
Standard exclusions from the policy
Although it states that any breach of professionalism will be covered under the indemnity insurance policy, people do realize that there are several exclusions under every policy. Not only professional indemnity, but many other insurances have standard exclusions that ought to be under any circumstances. Lets first have a look at some of the usual exclusions that are not covered under the insurance.
In case a third party or any of your customer has been damaged, this would not be included under the professional indemnity insurance. Since this matter comes under the umbrella of public insurance liability, businesses will have to opt for that section of insurance in order to avail compensation for any such claims. However, in case the damage or injury is done due to a certain breach of professional duty, it will be covered by professional indemnity insurance. Similarly, in case there are any claims made by the employees of the business regarding a disease of an injury, it would not be covered by professional indemnity insurance. Such a claim would come under the heading of employer’s liability insurance.
In addition to this, any claim regarding any delay in the supply of product or misinterpretation in the product description, the professional indemnity insurance would not cover this since it would be covered via the product liability insurance. Similarly, if the business’ courses of operations have been taken to another geographical location that do not come under the insurance deal, then the business cannot ask for any claim from the insurance company. There are certain criminal acts that do not come under the label of insurance coverage. Since insurances deal with the basic matters, they do not wish to be indulged in such punitive activities that might make an issue for themselves in later years.
There are several restrictions that cannot be claimed by the third party. The most basic aspect of this would be the general terms that have been agreed upon in the contract b/w third party and the business itself. If there have been certain clauses within a contract that give business a chance for delaying the supply, then the third party does not have any right to file a complaint against them. Whatsoever the case may be, the businesses should properly assess the situation in depth and look for professional indemnity and risk management in business to make sure they are doing good.
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