Thinking ahead regarding Management Consultant’s insurance

November 18, 2010 · Filed Under Management Consultant Insurance · Comments Off 

One of the required characteristics of a Management Consultant is the ability to ‘look ahead’. Using that skill to think about Management Consultant’s insurance might be worthwhile.

Clients

A management consultant (or consultancy) will typically put a lot of effort into building and maintaining a relationship with their client.

However successful that is, commercial relationships can sour in an instant and things may go from bad to worse.

In some circumstances, your client (or ex-client) may decide that your performance has led them to suffer material loss and they may expect to hold you accountable for that legally.

If you are sued under the auspices of professional liability, you may find yourself on the receiving end of claims for damages due to:

  • negligence;
  • misstatement or misrepresentation;
  • unintentional infringement of intellectual property rights;
  • the accidental misuse of confidential information;
  • a loss of documents;
  • etc.

If the case goes against you, then you may find yourself on the receiving end of very large awards and legal fees.

Typically the professional indemnity insurance component of management consultant’s insurance may help protect you from such costs.

The public and your employees

If you employ staff, in some cases even if they’re friends or family simply ‘helping out’, the law may demand that you have employers’ liability insurance to protect their interests.

By contrast, there is typically no legal requirement to have public liability cover but it may be wise to do so. If a member of the public (e.g. someone on the client’s site) is accidentally injured as a result of your actions, premises or property, they may sue you.

Once again, consultant’s insurance typically may help you deal with meeting such claims.

Is consultant’s insurance essential?

Excluding, possibly, employer’s liability cover, typically you may be under no obligation to take out such insurance protection.

However, some potential clients may demand to see evidence of your management consultant’s insurance before any contracts are awarded. It may be seen as a sign of professionalism, maturity and to some extent, risk reduction for them. By contrast, being unable to provide evidence that you have such cover may be negatively interpreted. Also, with some professions, having PII cover may be mandatory (for example, if you are an accountant).

Why take out management consultants’ insurance?

October 16, 2010 · Filed Under Management Consultant Insurance · Comments Off 

It’s to be hoped that you’re never in a position where you need to call upon management consultants’ insurance.

Recriminations

However, such situations may arise a little more easily than you may think.

Economic conditions are always tough and in today’s world people may not be inclined to ‘forgive, forget and move on’ when things go wrong.

A previously excellent professional relationship can deteriorate within minutes and move quickly into attribution of blame mode. Once that happens, you may be very close to people reaching for the phone to call their legal advisors – and taking the first steps on the road to needing to defend yourself from a legal action.

The costs of all of that, even if you win, may be very substantial.

That’s why it may be worth giving serious consideration to taking out management consultants’ insurance.

Risks covered

Typically a policy may offer you protection against things such as:

  • unintentional infringement of intellectual property rights and entitlements;
  • public liability cover (in the case of some policies this may need to be purchased separately);
  • libel and slander;
  • dishonesty;
  • product liability;
  • the loss of documents or data, etc.

The amount of cover provided would typically depend upon the cover levels you have purchased. Before trying to economise in that area, it may be worth noting just how big some awards against you may be if you’re sued and lose.

Without insurance, you may be trying to meet those costs out of your own financial reserves.

The probabilities

Nobody can tell you how likely you may or may not be to encounter these sorts of problems. Equally, nobody can predict what would happen should you find yourself at the wrong end of a legal action.

What is clear is that the potential costs involved are huge.

So, you may have a choice:

  • continue to ride your luck and simply hope it never happens to you or;
  • take steps to protect yourself and your business through appropriate insurance.

Management consultants’ insurance is often referred to as professional indemnity insurance (PII). Finding out more might be a smart idea.

How management consultants insurance may help

August 18, 2010 · Filed Under Management Consultant Insurance · Comments Off 

Your role as a management consultant may vary. One day you may be working with a very small firm and the next a multi-national company. The tasks you do typically vary too. You may carry out data collection, research and give advice. Your actions however may put you at financial risk sometimes and this is where management consultants insurance may help.

What is insurance for management consultants?
Typically, when working as a management consultant you may be handling data that is sensitive. Inadvertently you may do something that causes data loss. If so your client may take you to court. This might end up costing you a great deal of money and insurance typically helps towards the costs, up to a pre-defined limit. A typical management consultants insurance policy may provide cover for such as:

  • a breach of your client’s confidentiality that occurred accidentally;
  • losing any documents or data of your client;
  • liability for products in the event that they caused injury to;
  • infringement of intellectual property rights that was unintentional;
  • defamation or dishonesty on your part;
  • public liability insurance may be included. (However, do note that with some insurance providers this has to be taken out for an additional cost).

You may wish to consider insurance when you stop to think that part of your job as a management consultant may include:

  • preparing proposals or presentations;
  • working at the client’s site;
  • offering solutions and recommendations;
  • managing projects of your clients;
  • assisting clients.

While you may be very careful in your work and do everything by the book it is possible that a slip up may occur. If you are taken to court by a client, potentially the fees and court costs may be large. In some cases you may be unable to find the costs and this may mean the end of your business. Having adequate insurance in place may make a difference.

Of course as with any type of protection, including management consultants insurance, what you get for your money may differ depending on the insurance provider. Always check out the small print and terms of the policy before purchasing to ensure that you know what the indemnity insurance may cover as well as any potential exclusions and limitations.

Management consultants insurance – keeping clients happy

May 20, 2010 · Filed Under Management Consultant Insurance · Comments Off 

If you are a management consultant then somewhere near the very top of your critical success factors will be the need to inspire client confidence. How could management consultants insurance help you achieve that?

Client confidence – an intangible thing

It’s not easy to precisely define client confidence. If you have a contract with a client and some successful history of working together then hopefully that’s an indication that the client has confidence in you.

Yet at the outset during tenders and proposals, particularly if you have no previous record of working together, the client may be looking at a whole range of indicators trying to assess whether you’re someone that they wish to do business with.

Yes, your price and skills will be important factors but your client typically will also be looking for indications of your professionalism and maturity as a provider of service.

Management consultants insurance is one indication that you have thought seriously about the nature of the business you’re engaged in.

Client perceptions of risk

Clients today are typically looking for partnership and shared risk activities.

The days when you as a service provider could get it badly wrong and walk away carefree are now almost gone.

Clients know only too well how much it’ll hurt them if you are guilty of what they may typically call professional negligence. Both they and you no doubt sincerely hope no such thing will ever happen – but they may well be asking themselves the question what if?

They may well want to see that in such, hopefully unlikely circumstances, they may be able to recover some of their costs and damages through being able to sue you for professional negligence.

So, they may insist upon working with management consultants that demonstrate maturity and professionalism through having a visible and secure form of management consultants insurance (part of professional indemnity insurance) in place.

It may be a fairly safe bet that they will see the absence of such cover as a sign of a cavalier approach to business engagement rather than a sign of your confidence that nothing can go wrong!

Fault – a secondary consideration

In this context, the concept of blame and fault is secondary. If things go wrong in your activities on behalf of your client then it is their perception that counts because that will be the thing that decides whether or not legal action should follow.

If that does happen, you may find yourself on the painful end of some serious legal representation costs even if their action is subsequently unsuccessful.

If the client’s action is successful, then the awards may be staggeringly high and typically you’ll have to find the money yourself unless you have management consultants insurance to help.

Management consultants insurance knowledge

March 30, 2010 · Filed Under Management Consultant Insurance · Comments Off 

If you are a management consultant, then your business typically involves, among many other things, giving advice to other your clients. These people rely on your expertise to help them make key business decisions. However, there may be times when your client may feel that you have mis-advised them or something that you have done impinges negatively on their business. Because of this, management consultants insurance – which is a profession-specific form of professional indemnity insurance – can be useful in helping protect you, your clients and your reputation.

Anyone who owns a business, whether they are the sole employee or they have several or even hundreds of staff – runs the risk of having a claim made against them. Things can happen, such as the loss of sensitive documents; negligence; defamation; incorrect advice; even third party injury – these are difficulties that any business could encounter at any time. This is where professional indemnity insurance (PI insurance) can step in and help.

Certainly, it doesn’t matter how well run your business is, sadly things can wrong. And that is why considering insurance for management consultants can make sense.

Getting suitable cover

There are a number of providers of PI insurance, so it may be good to shop around and compare PI insurance policies. Also, when looking for cover, it is important that you use a specialist provider of professional indemnity insurance rather than getting a management consultants insurance quote from a traditional insurer who may not have access to the specific cover you need to protect your business.

A specialist professional indemnity insurance provider can draw on their expertise within the PI sector, to help you access protection that meets your requirements. They will often be able to offer tailor made insurance so that you get exactly the level of protection you need (for example, they may include or add-on public liability insurance in order to widen your range of cover).

Always check that the cover will give you the right protection by looking at things such as the amount insured any policy excesses; exclusions; and any other relevant points of the management consultants insurance policy.

Benefits of management consultants insurance

February 28, 2010 · Filed Under Management Consultant Insurance · Comments Off 

Protecting your business with management consultants insurance is something that it is sensible to consider for any business owner. This form of professional indemnity insurance is designed to step up and help you in the event that the unexpected happens.

If you run a business, you may think that nothing will ever go wrong – for example, that you will never be sued or accused of negligence. No doubt you take great pride in your work and ensure that your staff do so too.

However, some things are beyond our control and things can, and do, go wrong. Claims may be made against you or an employee for any number of things (eg the loss of sensitive documents; negligence; slander or libel etc) so getting your business protected with insurance for management consultants could be a sensible option.

Different types of cover
Management consultants insurance can be another term for professional indemnity insurance (PII). There are different types of professional indemnity insurance policies available and, often, different levels of cover too, which can help protect you and your business against the financial fallout of a third party claim.

Typically the management consultants insurance policy can help defend a claim against you as well assist with the cost of any damages you become liable for. Having this form of risk management in place in the shape of a professional indemnity insurance policy may help your management consultancy business survive if things get rocky and a client sues you or one of your employees for damages.

This may potentially help keep your business running where it otherwise may fail.

Where to buy PI insurance?
So, where do you look for a suitable consultancy insurance policy? The good news is that getting covered can often be quick and easy if you go to a specialist provider rather than trying to go for a one size fits all PII type of policy that a traditional or mainstream insurer may offer.

Buying it from a specialist PII insurance provider who has expertise within your particular sector may help you find the most suitable cover to protect your livelihood – and your reputation.

You need to choose your management consultants insurance with care, and that is why business people like you may want to seek out a reputable provider.

Management consultants insurance explained

January 16, 2010 · Filed Under Management Consultant Insurance · Comments Off 

Management consultants insurance is part of professional indemnity insurance (PII) and it could be said that it may in some circumstances save you from financial ruin.

Management consultants insurance – your risks

Your professional liability risks arise from a number of different areas of your day-to-day activities including:

  • you may have regular exposure to confidential client data – misplace it or accidentally disclose it to another party and you could be facing legal action;
  • you may have to comment upon the actions or abilities of individuals and companies around you – cross a sometimes almost invisible line and you could find yourself in court for defamation, libel or slander;
  • your client pays you for advice that they may act upon – if this proves to be significantly inaccurate and they suffer material loss as a result, you could be facing claims for professional negligence;
  • typically you’ll publish a lot of papers and reports – if you have used extensive material you thought belonged to your client that subsequently turns out to be the intellectual property of someone else, you may find yourself liable for huge copyright or intellectual property actions;
  • you make a recommendation that is subsequently judged to be dishonest because you failed to declare a possible conflict of interest.

Professional risk – “it could never happen to me….”

Perhaps it never will, but it may. It’s also worth noting that ignorance or ‘accidental’ are rarely acceptable defences in such cases. The law will look at what damages the plaintiff has sustained as a result of your actions or sometimes inaction, and decide accordingly.

Awards in professional indemnity cases may easily go into hundreds of thousands or even millions, depending upon the situation and severity.

It may also be worth keeping mind public liability insurance. That person who suffers an electrical shock and burns or bad cuts while setting up your equipment for you on a client’s site may well have a legal right to look to you for compensation.

Management consultants insurance

There is perhaps a tendency to think of professional indemnity insurance and public liability cover as something of a luxury you can do without. That’s something you may sincerely believe and will continue doing so – right up until you get hit with the claim or legal action.

The cost of management consultants insurance may be small when considered alongside the risks and potential costs you face if something goes wrong. Finding out more won’t cost you anything and it may be the first step towards putting in place insurance that could prove to be a financial lifeline if trouble strikes.

Management consultants insurance explained

December 18, 2009 · Filed Under Management Consultant Insurance · Comments Off 

Management consultants insurance is part of professional indemnity insurance (PII) and it could be said that it may in some circumstances save you from financial ruin.

Management consultants insurance – your risks

Your professional liability risks arise from a number of different areas of your day-to-day activities including:

  • you may have regular exposure to confidential client data – misplace it or accidentally disclose it to another party and you could be facing legal action;
  • you may have to comment upon the actions or abilities of individuals and companies around you – cross a sometimes almost invisible line and you could find yourself in court for defamation, libel or slander;
  • your client pays you for advice that they may act upon – if this proves to be significantly inaccurate and they suffer material loss as a result, you could be facing claims for professional negligence;
  • typically you’ll publish a lot of papers and reports – if you have used extensive material you thought belonged to your client that subsequently turns out to be the intellectual property of someone else, you may find yourself liable for huge copyright or intellectual property actions;
  • you make a recommendation that is subsequently judged to be dishonest because you failed to declare a possible conflict of interest.

Professional risk – “it could never happen to me….”

Perhaps it never will, but it may. It’s also worth noting that ignorance or ‘accidental’ are rarely acceptable defences in such cases. The law will look at what damages the plaintiff has sustained as a result of your actions or sometimes inaction, and decide accordingly.

Awards in professional indemnity cases may easily go into hundreds of thousands or even millions, depending upon the situation and severity.

It may also be worth keeping mind public liability insurance. That person who suffers an electrical shock and burns or bad cuts while setting up your equipment for you on a client’s site may well have a legal right to look to you for compensation.

Management consultants insurance

There is perhaps a tendency to think of professional indemnity insurance and public liability cover as something of a luxury you can do without. That’s something you may sincerely believe and will continue doing so – right up until you get hit with the claim or legal action.

The cost of management consultants insurance may be small when considered alongside the risks and potential costs you face if something goes wrong. Finding out more won’t cost you anything and it may be the first step towards putting in place insurance that could prove to be a financial lifeline if trouble strikes.

Indemnity protection through a management consultants insurance deal

August 15, 2009 · Filed Under Management Consultant Insurance · Comment 

Few of us go through personal and professional life without making a mistake – slip ups are a fact of life, even with the best training and preparation there is. Errors while working as a consultant can be costly because of the work a management professional takes on – perhaps becoming an interim boss for a section of a company or being hired to make important recommendations of efficiency. As such management consultants insurance is often taken out as a crucial safety net by firms and individual freelances alike.

Professional cover normally relates to protection against legal threats, and this normally refers to things like public liability insurance and professional indemnity cover. Public liability is perhaps better understood than indemnity protection – being a legal requirement for many firms that operate in public or have members of the public on their premises on a regular basis.

Professional indemnity, on the other hand, will usually cover the cost of legal defence in the event you face being sued by a client – typically due to a costly mistake, error, or omission – circumstances not protected by public liability cover.

To give an example, a management consultant might be hired by a firm with a high number of sales staff to give advice about how they can improve their sales figures through various customer relations techniques – if numbers actually worsened after the assignment the firm may blame the consultant and take legal action.

Management consultants insurance typically covers the policyholder whether they are to blame or not – a payout is not normally conditional on the claim being valid. Furthermore, even if the policyholder loses the case, the insurance may even cover the cost of any compensation awarded against them, up to the policy limit.

The top limit on a plan is decided when the insurance is taken out and is important because it represents the maximum amount an insurance company will pay out towards legal defence and compensation – larger firms may need protection for millions of pounds, while smaller companies dealing with smaller clients may need a limit far smaller.

Management consultants insurance normally covers claims of errors, omissions, acts of negligence and also things like claims of unintentional breach of confidence or copyright, allegations of defamation and even the claim a consultant has acted dishonestly – this means some of the more common legal risks are less of a threat to a business with a straightforward insurance policy.

The basic elements of management consultant insurance

July 16, 2009 · Filed Under Management Consultant Insurance · Comment 

One of the trickier tasks when setting up a business can be sorting out what type of insurance cover is needed. Some types of business actually need some types of deal in place by law, including the likes of public liability insurance and professional indemnity insurance. Examples of professionals which may need this type of cover by law include architects, solicitors, and accountants. Other professionals may not have to have protection in place as a matter of course, but may have been thinking about it thanks to some of the financial and practical benefits. Management consultant insurance is an example of this kind of cover which can provide tailored insurance just for this type of professional.

This kind of cover will normally include an element of indemnity insurance and also public liability insurance, often as an option or included in the price. Management consultants could be classed as one of the brands of professionals which are at risk of legal action, and may want their own personal policy to protect against this.

Indemnity cover cannot stop somebody from being sued but it can prevent some of the financial difficulties associated with it. It protects somebody in the event they are facing a legal claim following a mistake, omission, or act of negligence. This kind of cover will protect someone whether or not the claim is valid.

It will effectively pick up the cost of someone’s legal bills for defending the case against them, and management consultant insurance will even pay the cost of any compensation which happens to be awarded against the policyholder. This can at least mean that someone’s defence is taken care of by the insurance, which can make things considerably easier, particularly for businesses which do not have deep pockets.

For example it could pay out if somebody is accused of offering advice during an assignment which the client believes is not useful or which actually harms them financially after they have followed it. After claiming on a policy the management consultants legal costs would be covered right the way through a case to its conclusion, provided they stay within a set policy limit which is laid down when the cover is taken out.

To get this kind of insurance you can contact all sorts of insurance companies which specialise in professional insurance and can provide somebody with a number of quotes. The cost will be connected to the policy limit, which is important because naming an amount which is too low will mean somebody could end up under insured in a legal action, and if it is too high they would paying for a level of cover which they don’t really need.

These are the basic principles of management consultant insurance, which remain the same across all sorts of policies. The key element to remember is that they could save a business thousands of pounds all the way up to millions, should they face a costly legal action following a dispute related to an assignment.

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