Management consultants professional indemnity insurance facts

August 23, 2010 · Filed Under management consultant professional indemnity insurance · Comments Off 

Management consultants professional indemnity insurance is specifically aimed at anyone in the management consultant business.

The name of this type of insurance policy may be a bit of a mouthful to say, but management consultants professional indemnity insurance may be a financial lifeline. Designed for businesses, the policy typically protects against the financial fall out of a claim being made against you for such things as negligence or libel and slander.

Court costs may be the death of your business if you have to find the money from your business reserves. This is where the insurance policy comes into its own, if needed.

What is professional indemnity insurance?
Policies may vary among the different insurance providers so therefore it may be in your best interests to check the policy features and benefits and never just assume that what one provider offers is offered by another.
What does an insurance policy typically cover?

Your client may accuse you of libel or slander against them and if the company decides to take you to court, the cost of the case might run into many thousands of pounds. If you do not have insurance, could your business afford to pay for these costs?

Data and documents loss
Management consultants professional indemnity insurance typically may often cover data or document loss of your clients.

When working with clients and their data there is always a risk. If data or documents are lost or are compromised, then, again, a court case may be brought against you.

Wrong advice or recommendations
Typically your job as a management consultant means that you are giving advice and recommendations to clients. If you were to accidentally give the wrong advice and the client lost a lot of money due to making decisions based on the information given by you, potentially a court case may be brought against you. Again if you do not have insurance to rely on you may need to pay the court costs from your pocket.

Management consultants professional indemnity insurance may be worth considering, especially when you compare the often competitively priced cost of it to the amount of money you might have to find yourself if a claim is made against you. A policy may of course cover a great deal more than outlined above and not all insurance providers may offer the same benefits.

Basic guide to management consultant professional indemnity insurance

Sorting out the right kind of cover is essential for any business, whether you are a pizza delivery driver or a management consultant. Different kinds of policy are appropriate to different kinds of business, and indemnity insurance is an option for anyone worried about the legal risks of what they do. Specifically it applies to the chances of you being sued, or rather the financial implications if you ever face legal action. For anyone unsure about what it does, here is an outline of what management consultant professional indemnity insurance is.

Indemnity cover is not exclusive to management consultants and can apply to anyone who offers professional advice for a living. It covers you if you are formally accused of making a mistake in the course of your business, i.e. being sued.

Besides mistakes, which may result in legal action if they cost a client money, policies normally also cover omissions, acts of negligence, and other allegations. These are normally claims you have breached confidentiality or copyright, defamation and slander, and the loss or damage of a client’s data or documents.

Should you be formally accused of any of this, you simply claim on your policy, which will pay out towards your legal defence. Hiring legal help is hardly ever a cheap experience but is essential in many cases if you wish to defend an action effectively.

Management consultant professional indemnity insurance also typically pays out for the cost of any compensation which might be awarded against you in the event the claimant is successful. As you might have guessed, indemnity cover will not pay out for an indefinite amount and there will be a ceiling attached to a policy. Thankfully this can normally be specified by the policyholder, and the larger and more high profile a firm is, the larger they may want this ceiling to be. Of course a premium may be priced accordingly.

Management consultant professional indemnity insurance will also pay out no matter how valid the claim against you is an no matter how far through the courts system the case goes. Protection will be provided all the way up to the High Court if necessary, provided you are still within your cover limit. It’s therefore a useful and potentially vital safety net against the financial impact of a frustrating and costly legal claim.