Computer Contractor Public Liability Cover

October 25, 2008 · Filed Under computer contractor public liability cover 

Even when an expert has plenty of experience and puts detailed planning in place, mistakes can still happen. An error made by a contractor, seen as a specialist in their field, could end up leading to a legal claim being made against the contractor, who may even be accused of negligence. Computer contractor public liability cover is designed to activate and provide financial support for legal fees so the individual or firm does not face severe difficulty.

Some potential clients will not even consider hiring a computer contractor unless they have this type of cover, so some consider it a vital tool in operating a business. The policy is usually used to help defend a claim against a contractor, even claims that may seem completely untrue or unfounded. It will usually even cover any damages awarded in favour of a complainant. Having this type of cover in place through a professional indemnity insurance policy can therefore sometimes be the difference between a firm running almost as normal and having to fold due to legal fees.

Although professional indemnity cover is geared to paying legal fees, the policy holder will usually have to pay an agreed excess, as with other types of insurance. Once cover is in place, it’s also worth considering the fact there is often a long time gap between an event happening and a legal claim being made. This means if a consultant is thinking about swapping providers or stopping trading, they may require what is known in the business as a “run off” period. When changing to a new provider, it could be worth making sure they are willing to accept a claim which refers to an older incident, should one arrive.

The amount of cover which is selected is significant as a policy which does not give adequate protection can mean the computer contractor can still end up with a big bill. So, say a contractor takes out £50,000 of Computer contractor public liability cover but has to defend a case which results in £67,000 of fees, they will have to pay £17,000. This is known as being under-insured and the right cover decision will need to be made if this situation is to be avoided.

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