Why take out IT consultants insurance?

August 11, 2010 · Filed Under IT Consultants Insurance · Comments Off 

IT consultants insurance may also known as professional indemnity insurance (PI insurance). This is a form of protection that with most professions you do not have to take out by law, but it may be wise to do so (and some professions will require that you have it in order to practise).

A policy typically gives you insurance against a number of events that may lead to your clients taking you to court. Court costs soon add up, so the insurance is potentially a type of safety net against financial ruin.

Sticking by the rules
Even if you stick to all the rules something may happen that you have no control over. You may lose your client’s data and even though it was an accident, your client may wish to take you to court, especially if this loss of data had some serious ramifications to their business.

The same may happen if you are accused of slander or defamation of character. IT consultants insurance may generally cover accidental situations such as these.

Things to remember when considering insurance
There are some things to remember when you are considering taking out IT consultants insurance. The first of these is that the insurance may not help you if you do something intentionally and you are found guilty in court. In this case you will typically be liable to pay the costs yourself.

Also bear in mind that all insurance policies typically come with terms and conditions, along with exclusions. The exclusions are usually what you cannot claim on your insurance policy for. The limitations generally state how much you may be able to claim, in the event of making a successful claim for one of the events covered in the insurance policy.

If you fail to take out IT consultants insurance and the worst were to happen could you afford to bear the potentially large costs that may be involved? You may even end up losing a great deal more than your credibility; you might lose your business to pay for your mistake.

IT consultants’ insurance – the basics of a policy

July 12, 2010 · Filed Under IT contractors insurance · Comments Off 

Anyone in business might want to consider the various types of insurance out there. For example buildings insurance typically protects against something happening to your business premises. Another type of insurance that you may wish to consider if you are in the information technology business is IT consultants insurance.
A policy typically provides protection against several events.

What is IT consultants insurance?
As an IT consultant you are typically dealing with individuals and companies who rely on you and your advice. If you were to give someone advice that causes negative implications to a business, you may potentially find yourself facing a claim for compensation and a court case. This typically comes with often substantial costs, but with professional indemnity insurance, you may get assistance – up to a set limit – to help meet your legal costs.

Losing clients data or documentation
As an IT consultant you are probably around a great deal of data belonging to various clients. If something happened to this data or paperwork, you may be taken to court. Again IT Consultants insurance is there to help you out financially.

Breach of confidentiality
You may accidentally cause a breach of confidentiality. The insurance policy may typically cover this event, which again might end up saving you a great deal of money as well as damage to your reputation.

Public liability insurance
If you have visitors at your place of business you may want to consider if public liability insurance is already included in your insurance. This form of protection typically helps to protect you against the financial implications of being sued if someone suffers injury or death whilst on your property. Some insurance providers may include it as a standard part of your cover, or it can often be an optional extra.

Choosing your policy
Of course insurance companies recognise that there are many different sizes of businesses – your company may consist of just two or three or it might be a hundred or more. With this in mind you may wish to check out that any IT consultants insurance policy you are considering is adequate for your company’s needs. Reading the terms and conditions thoroughly and speaking to your broker if you have any queries may be key to ensuring that you get the most suitable insurance for your business.

Protecting your livelihood with IT consultants insurance

June 12, 2010 · Filed Under IT Consultants Insurance · Comments Off 

You may find yourself being sued. Without IT consultants insurance, you may end up needing to pay possibly crippling amounts of money to settle damages and legal fees.

How could that happen?

As an IT consultant, you may be responsible for giving advice and guidance on some significant spending decisions.

While the budget holders may all sign off on your recommendations, if there are problems later on, you may find that you’re held accountable.

Indemnity insurance

IT consultants insurance is a type of professional indemnity insurance (PII).

This provides financial assistance in the event that the client you are working for suffers damage or financial loss which can be attributed to something that you may have done, or omitted to do, in the course of providing them with your services.

As an IT consultant, negligence on your part may be more likely to cause financial rather than physical damage.

Some typical areas where PII for IT consultants may typically help provide you with protection include:

  • accidental breach of confidentiality;
  • loss of documents or data;
  • infringement of intellectual property rights;
  • defamation of character;
  • allegations of libel or slander.

PII will typically also cover your legal fees and expenses, whether or not the case against you is upheld.

Optional extra

Indemnity insurance for IT consultants is not compulsory in the way it typically is for some other professionals like solicitors or financial advisors.

However, aside from the very real protection that PII provides, it may also demonstrate your responsibility and professionalism to potential clients.

In an environment where competition for work is fierce, having a few extra points in your favour may do no harm.

Continuity of cover

An interesting facet that may be worth consideration is that with many providers of PII, if you stop paying premiums your cover will stop. Nothing unusual in that, you may think.

The trouble is, the nature of your job is such that it may be that problems do not arise straight away.

So if you finish one assignment, decide to take some time off and cancel your IT consultants insurance because you won’t actually be working, you may have to make special arrangements (sometimes known as run-off cover) to ensure that you would still be covered for historical problems.

Business risks and IT Consultants insurance

May 9, 2010 · Filed Under IT Consultants Insurance · Comments Off 

For IT consultants, mistakes may prove to be very expensive. IT consultants insurance typically exists to help protect you against such costs if you’re unlucky enough to incur them.

Why do IT consultants need insurance?

If you accidentally create a problem for a client or even if they just believe you have created a problem for them, then you may hope that a rational discussion will be all that’s required to resolve the issue.

If that works then fine – but what if it doesn’t?

Business today typically can’t afford mistakes. Errors cost money and like it or not, we live in a business culture where increasingly the philosophy is that someone must pay.

If your services result in serious damage to your client, then they may take you to court seeking financial restitution – and that’s unlikely to be for trivial sums.

If you don’t have IT consultants insurance then typically you’ll need to find these sums yourself.

If this sounds implausible:

  • in 2008 British Gas demanded compensation from consultancy Accenture of around £182million for a flawed IT system.*

I’m not a big company!

Perhaps not, but it only takes one mistake by one person to sometimes cause potentially very serious and expensive consequences.

IT consultants insurance is part of what’s commonly termed professional indemnity insurance or PII for short. It can offer protection against various professional risks that could result in legal action against you.

The exact nature of the cover provided varies depending upon the provider of your insurance and the product you select. Typically you may find protection against things such as:

  • accidentally losing key information of your clients;
  • accidental contravention of confidentiality and non-disclosure agreements;
  • accusations of slander or libel;
  • infringing (unintentionally) someone’s intellectual property rights.

It’s perhaps worth contemplating that a court may not take much notice of the size of your company when making awards – they may be much more focused on the damage sustained by your client.

That’s why the awards may be large and certainly big enough to cause you serious financial pain.

Even if you do not lose such a case, you can’t guarantee being awarded costs and you may have run up significant legal bills in making a case for your own defence.

It won’t happen to me!

It’s certainly to be hoped that you do avoid being sued but is that hope something you’re willing to gamble your professional and possibly personal financial future on?

Of course, having IT consultants insurance can’t stop one of your clients suing you. It may mean though that you can rest a little more easily knowing that if the worst happens, you have financial support to fall back upon.

*Source: Contractor UK – http://www.contractoruk.com/news/003785.html

IT consultants insurance and peace of mind

April 12, 2010 · Filed Under IT Consultants Insurance · Comments Off 

The health of many businesses these days may be inexorably linked, in one way or another, to their IT infrastructure. This may represent a huge responsibility for those whose job it is to develop or change this infrastructure, which is why IT consultants insurance may be a sensible step for you.

IT consultants insurance is a form of professional indemnity insurance or PII.

This type of insurance offers protection from the consequences of being sued for damages by your client if they have suffered financial loss as a result of your professional services.

There are a number of potential areas where your professional actions could have adverse financial repercussions.

Typically as an IT consultant, you may be giving advice on what could result in major financial expense on new IT infrastructure or recommending and designing changes to existing systems.

There are the obvious situations, where your client’s business may not be able to function properly as a direct result of something you did (or recommended to have done) to their IT systems. This may result in significant loss of income for your client, not to mention the additional costs for rectifying the situation and then paying again to have the work done properly.

Other possible problems could arise from:

  • losing data or documents belonging to your clients;
  • accidentally breaching confidentiality;
  • incidents of libel or slander;
  • being late in delivering agreed milestones;
  • accidental infringement of intellectual property rights;
  • etc.

In any of the above circumstances, some of your clients may be happy with a sincere apology from you but others may not – they may seek some form of financial redress. This may take the form of suing you for damages.

In this situation, if you didn’t have any IT contractors insurance you may be facing the prospect of needing to find significant amounts of money for two different types of costs:

  • damages awarded against you if your client’s claim is successful;
  • the money you personally would have to find to pay the legal costs and fees arising from having to defend yourself against the claim – even if you were ultimately successful.

If you have IT consultants insurance on the other hand, provided you have adequate levels of cover, your insurance may cover some of these costs for you subject to the policy details.

IT consultants insurance may not be a mandatory requirement for you to carry out your role of providing professional services but it may help to keep your business afloat if you end up at the wrong end of a claim for damages.

IT consultants insurance – professional indemnity insurance for your business

March 8, 2010 · Filed Under IT contractors insurance · Comments Off 

IT consultants insurance is a trade-specific professional indemnity insurance policy. Professional indemnity insurance (PI insurance) is something that many businesses will have, whether through choice or because it is mandatory to their profession (such as if you are an accountant). This insurance can give you peace of mind that should something go wrong and you are sued by a client, your business finances (and hopefully your reputation) will remain intact.

IT consultants insurance can generally provide cover against unsavoury situations that may occur such as accidental breach of confidentiality; defamation; libel; slander; dishonesty of an employee; loss of data or documents; unintentional infringement of intellectual property rights; wrong advice etc.

Public liability insurance may also form part of a PI insurance package or can often be purchased as an add-on to enhance your company’s protection.

Why do I need it?

Something as everyday as you providing consulting work on a computer system that then all goes horribly wrong may see your client sue you for damages. Not only will a court case be stressful, but your reputation and your business finances could be seriously compromised if your client is awarded damages.

This is where IT consultants insurance may be able to help, typically by paying towards the costs of defending you against any allegations made against your company, as well as any damages that are awarded.

In a nutshell, the policy can help defend a claim against you as well as cover you for any costs you become liable for. Certainly, having this form of risk management in place in the shape of a professional indemnity insurance policy may help your business survive if things get rocky and a client sues you or your business.

As mentioned in the opening paragraph, in some professions, professional indemnity insurance is mandatory. You may also find that some clients will only work with you if you can show that you have a PI insurance policy in place. This gives them protection that, should they need to sue you, they know they stand a chance of getting any costs awarded, if their claim is successful!

It can be a dog-eat-dog world out there and society seems to be more litigious than ever. Protecting yourself with IT consultants insurance may be something worth considering.

IT consultants insurance – business protection

February 22, 2010 · Filed Under IT contractors insurance · Comments Off 

IT consultants insurance can typically provide your business with invaluable financial protection against claims from third parties who believe that you have done something that it is detrimental to them or their business.

A typical IT consultants insurance policy provides cover against claims for such things as third party injury; negligence; loss of data or documents etc. Sometimes known as professional indemnity insurance (PII) (with public liability cover often included or added on), this business insurance helps provides protection in respect of any legal liability claim against your livelihood by assisting financially with court cases, legal defence and awards for damages – subject to your claim being satisfactorily accepted of course.

When choosing IT consultants insurance, there are a number of considerations that you need to take in to account:

  • do note that as with most insurance policies, in the event of a claim, generally you will be liable to pay an excess on your policy. Ensure you know what this is;
  • ensure that your policy covers all time frames. Often, there may be a delay between an event happening and the subsequent claim against you / your business. So, if you are in the middle of changing insurers or getting a new IT consultants insurance policy, ask your new provider if they will accept new claims for prior incidents. This is often known as retroactive cover;
  • there are many PII policies offering different levels of cover, so ensure that you have an ample amount of protection. Do be realistic as to the amount of IT consultants insurance needed. Being under insured is almost as bad as not having insurance at all;
  • policy features and benefits of an insurance policy will invariably differ depending on the insurance for IT consultant providers. Ensure that you check them to confirm the pertinent points of the IT consultants cover.

Prevention
Of course, it’s not just about getting the most suitable insurance for IT consultants cover – there may be ways that you can help minimise the risk of someone making a claim against you. Common sense things, such as documenting expectations beforehand, (eg responsibilities, deadlines etc) may mean you can manage the workload and the relationship before any problems arise.

IT consultants insurance should be considered by anyone who runs a business as the benefits offered in the face of a claim may prove invaluable.

Why buy IT consultants insurance?

January 11, 2010 · Filed Under IT contractors insurance · Comments Off 

Although you may enjoy your job and chosen career immensely, you may potentially be at risk of serious financial loss if you do not have IT consultants insurance. Why?

By virtue of your job, you provide professional services in return for a fee. If one of your clients suffers material loss or damage as a result of your error or poor advice, they may well turn to you for real hard-cash financial compensation. The sums awarded by courts may also be very substantial indeed.

Perhaps this sounds a little unlikely? Consider some following scenarios:

  • you have recommended the procurement of a major system or hardware infrastructure that subsequently proves not to be fit for purpose;
  • you have accidentally sent a confidential file of your client’s information to the wrong addressee on your email system;
  • you have passed on for comment to others some of your client’s information only to subsequently discover that is regarded as commercially sensitive.

The list could easily be significantly extended.

The key point is that as a professional business person you could be called to account legally for a wide variety of things including slander and libel, professional negligence and incompetence, breach of client confidentiality / non-disclosure agreements or defamation of character.

In all these situations, the ‘accidental’ nature of the infringement or what you may have actually intended to do or may be, at best, of only secondary interest to a court. What will count is the effect on your client or the plaintiff and that is where damage awards may leave you in serious financial difficulties unless you have IT consultants insurance. This insurance may help in situations like these.

This form of cover is part of our professional indemnity insurance (PII) product. We also offer public liability insurance to protect you against the financial effects of claims from members of the public who have suffered injury or loss as a result of your activities.

You can find out more about IT consultants insurance entirely free of obligation by reading further information on our web site. It may be a useful investment of your time and a first step towards reducing your financial exposure profile!

Why buy IT consultants insurance?

December 15, 2009 · Filed Under IT Consultants Insurance · Comments Off 

Although you may enjoy your job and chosen career immensely, you may potentially be at risk of serious financial loss if you do not have IT consultants insurance. Why?

By virtue of your job, you provide professional services in return for a fee. If one of your clients suffers material loss or damage as a result of your error or poor advice, they may well turn to you for real hard-cash financial compensation. The sums awarded by courts may also be very substantial indeed.

Perhaps this sounds a little unlikely? Consider some following scenarios:

  • you have recommended the procurement of a major system or hardware infrastructure that subsequently proves not to be fit for purpose;
  • you have accidentally sent a confidential file of your client’s information to the wrong addressee on your email system;
  • you have passed on for comment to others some of your client’s information only to subsequently discover that is regarded as commercially sensitive.

The list could easily be significantly extended.

The key point is that as a professional business person you could be called to account legally for a wide variety of things including slander and libel, professional negligence and incompetence, breach of client confidentiality / non-disclosure agreements or defamation of character.

In all these situations, the ‘accidental’ nature of the infringement or what you may have actually intended to do or may be, at best, of only secondary interest to a court. What will count is the effect on your client or the plaintiff and that is where damage awards may leave you in serious financial difficulties unless you have IT consultants insurance. This insurance may help in situations like these.

This form of cover is part of our professional indemnity insurance (PII) product. We also offer public liability insurance to protect you against the financial effects of claims from members of the public who have suffered injury or loss as a result of your activities.

You can find out more about IT consultants insurance entirely free of obligation by reading further information on our web site. It may be a useful investment of your time and a first step towards reducing your financial exposure profile!

Understanding IT consultants insurance plans

November 2, 2009 · Filed Under IT Consultants Insurance · Comments Off 

IT consultants may carry with them a significant amount of technological equipment, including laptops, handheld devices, and other gear. Hopefully they will have insured these for accidental damage, but there are other cover considerations to consider too. For example, an IT consultants insurance plan may include an element of professional indemnity protection.

This is a kind of cover which may be considered by any business which provides professional advice. For example, in the past it has been associated with more traditional trades such as accountancy and the medical profession. This is because sometimes these experts need a level of professional indemnity in order to qualify for membership of certain associations.

But professional indemnity has recently become more popular with other kinds of business. This is because of a heightened level of legal awareness in business and in society in general, which may increase the chances of being sued if something goes wrong.

Professional indemnity typically protects you or your business in the event you are taken to court following a mistake.

Typically you are entitled to pay outs in the event you face action for an act of negligence, error, or mistake in your general business.

The payouts are designed to cover defence fees run up by solicitors, plus compensation costs if they are awarded in favour of the applicant.

This is significant because the cost of hiring a legal team to defend a legal case may be astronomical. As such the payout limits on these types of IT consultants insurance plans may be hundreds of thousands of pounds or more. You may need to decide the level which is right for your business. For example, a very large company with international clients and a turnover of millions of pounds may want a level of protection which is higher than a lone freelance with a limited client list.

One of the benefits of this type of cover is that it does not normally require that the claim against you is invalid for the payouts to be made. Even if you have made a genuine mistake or acted negligently, typically payouts are still made.

One of the common conditions on a policy like this is that mistakes or errors that you make are not intentional, i.e. are committed without malice and are not deliberate.

Cover like this may also be altered to include protection for when you are in between insurers or winding down a business, often referred to as ‘runoff cover’.

You may even get protection against claims which arrive in the future but which date back to something which happened in the past, possibly before you even took out the indemnity insurance.

IT consultants insurance typically involves a regular premium – often related to the maximum level of payout on the policy and possibly also connected to the qualifications and experience of your or any of your employees if this applies.

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