Do I Need Professional Indemnity Insurance If I’m Self-Employed?.
More of us are discovering the joys of working for ourselves. Leaving traditional workplaces to become self-employed or start our own small companies. The number of freelancers working in the UK has increased 36% from 1.4million to a staggering 1.91million since 2008.
According to a report by the Association of Independent Professionals and the Self Employed (IPSE), freelance workers are most strongly represented in:
- education, health and social work (21%),
- professional, scientific and technical activities (20%), and
- arts, entertainment and recreation (12%).
The report states that for 1.65 million freelancers, it is their main occupation. Self-employed individuals have to understand their own tax, laws and insurance, should professional indemnity insurance be on your shortlist?
What Is Professional Indemnity Insurance?
Professional Indemnity (PI) insurance covers individuals or organisations providing professional services to clients against things which lead to expense, either for the client or the provider. This could include claims stemming from breaches of professional duty, negligence, or just plain human error. Protecting your finances with PI insurance means you would be able to continue trading in the event of a case.
Do I Need It?
Only certain professions and industries are likely to need PI compared to others. Whilst it’s an industry requirement for some, for others it is simply good common sense. In a nutshell, you need PI if you provide advice, services or designs which clients depend on. Some examples include; accountants, medical professionals, financial advisors, architects and property surveyors. Solicitors and legal professionals are required to have their own kind of PI insurance.
It is also a good idea to arrange this protection if you are an advisor of any kind. From HR and IT consultants and graphic designers, if a business acts on your advice and it results in damage to its finances or reputation, they could take action against you. Without insurance you may have to pay legal costs and damages out of your own pocket.
How Do I Choose The Right Policy?
Unlike other insurance policies which usually have a standard upper limit (the maximum amount your insurer will pay out), PI Policies often have a choice of limits. Your relevant industry bodies may well make a recommendation on which one you should choose.
An insurance broker is often the best source of advice, here at Hinks Insurance we can offer Professional Indemnity tailored to your profession and circumstances. Please give us a call on 01482 323424 to discuss in more detail.
