Why you should consider getting professional indemnity insurance

No one provides service to a client with the intention to indulge in malpractice, because it doesn’t serve the purpose of either the client or the service provider.  However, not all future events are within your control and things can go wrong anytime during your contract period with the client.  Professional indemnity insurance covers this unforeseen aspect of your business where you may have to face a legal action due to an incident arising from the services provided by you.

 

The insurance cover allows you to carry out your business without worrying about a potential lawsuit.  You save a lot of time and money that you would have otherwise spent on defending a legal battle.  The legal issues don’t become a hindrance to your business, which in turn prevent the loss of income that could have happened during the period of defending the allegations without the cover.

 

The insurance covers many risks, such as:

 

Breach of confidentiality:  As a service provider, you are required to maintain the confidentiality of the business.  However, you may unintentionally disclose some information provided to you by the client to a third party.  Professional indemnity insurance provides you the cover to handle the situation without impacting you financially.

 

Breach of contractual agreement:  If you fail to adhere to the guidelines specified by the client or if you are unable to finish a project within the stipulated time, the client is entitled to file a lawsuit against you for the loss of business.

 

Theft or fraud:  In the event of a fraudulent activity by a staff member of the service provider, the client may initiate legal action against the service provider. However, indemnity insurance covers the claim by the client for the alleged loss.

 

Loss of important documents:  Professional indemnity insurance covers any loss of data that was in the custody of the insured.  If you lose or misplace a document and you are unable to retrieve it, it can result in business loss for the client depending on the significance of the document.

 

Defamation:  Any verbal or written communication that is deemed defamatory by the client can lead to legal action.  However, if the defamation was unintentional, the cover is provided to the insured.

 

Intellectual property breach (unintentional):  The insurance covers any accidental infringement of intellectual property under the copyright act.  For example, a consultant may be working with two clients and inadvertently uses a design or information of one client in a project with another client.

What Are Some of the Common Types of Commercial Insurance?

What is commercial insurance?

Commercial insurance helps provide protection against loss, theft, damage and destruction to businesses, property, ships, employees in companies, workmen working in dangerous construction sites, marine cargo on board ships, machinery and equipment and basically anything else, apart from personal insurance. Commercial insurance is just as important as personal or life insurance, as you can recover the complete cost of damage or loss to your property and buildings that you might have spent a lot on in the first place.

What are some of the common types of commercial insurance?

Here are some of the common types of commercial insurance provided by Allegiance, an insurance company located in Singapore that provides all kinds of personal and commercial insurance, as well as professional indemnity insurance in Singapore.

Employees benefit insurance – today, employees are just as important in big companies and organizations as the other assets of the company and without these valuable employees, the organization wouldn’t be able to run and make profits. Today’s environment is also extremely competitive so it is vital to retain the good employees. There are many employee benefit plans and packages available today to protect the interests of company employees and provide them with medical, accident and life insurance.

All companies, whether small, medium or large, must take employee benefits insurance for their employees as they are the most valuable assets to the company. Allegiance provides many comprehensive employees benefit insurance plans that are cost efficient, flexible and provide full coverage. They will even customise an employee benefits insurance program for you to adapt to your company’s needs and preferences.

Professional indemnity insurance – also known as professional liability insurance, it is a type of commercial insurance that is made to protect the financial interests of certain working professionals like lawyers, attorneys, insurance agents, accountants and similar professionals rendering legal and financial services.

They might commit errors, omissions, and certain unintentional acts of negligence or misjudgment while carrying out their professional duties towards clients. These professionals need protection for themselves and their property against hefty legal penalties and fees imposed by third parties and government authorities. Allegiance will provide professional indemnity insurance in Singapore to protect the business of professionals and the employees working in these organizations.

When do you need professional indemnity insurance?

You or your business will require professional indemnity insurance if:

  • You provide a professional service
  • These services are rendered to clients
  • You handle confidential information
  • You use the intellectual property rights of another company or professional
  • Your client requires you to have insurance
  • Professional indemnity insurance is compulsory for your company or business