Protecting your livelihood with management consultants professional indemnity insurance

September 17, 2010 · Filed Under Management Consultant Professional Indemnity Insurance · Comments Off 

Unfortunately, running a business isn’t just about bringing the money in and keeping your customers happy. As part of the day-to-day running of your company, one thing you may need to ensure is that you have the necessary protection in place should something go wrong and a claim is made against you, your company or an employee. And that is where management consultants professional indemnity insurance is designed to help.

Management consultants insurance may be considered important for anyone who runs a business and wishes to protect it against potential financial losses caused by a claim being made against it.

In fact, with some trades, such as Accountancy, you are legally obliged to have the cover.

Policy benefits

Having risk management in place in the form of professional indemnity insurance may help your business survive if something accidentally goes wrong that causes perceived financial harm or other loss to another party. There are profession-specific forms of professional indemnity cover and, often, different levels of protection too.

Why professional indemnity insurance?

Consider this – would your business survive if it was faced with a claim of negligence against it? One claim could quite simply wipe out your business’s financial resources. But having the financial protection of professional indemnity insurance in place may help stop this (any claim paid would be up to a pre-agreed financial claim limit).

Is it really necessary?

You may believe that management consultants professional indemnity insurance is an expensive, unnecessary overhead. However, do remember that any business, no matter how well run, can face substantial claims against them.

And with Court awards rising sharply in recent years, it may be worth seriously considering professional indemnity insurance.

Buying it

So, where do you go if you want to buy professional indemnity insurance for management consultants?

Tailor made, bespoke insurance is available with some specialist professional indemnity insurance providers, meaning typically that you can often get cover that is specific to the nature of your business.

Even the tightest of run companies may face the prospect of financial ruin should a claim be made against it. Management consultants professional indemnity insurance may help alleviate this worry.

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.

Choosing management consultants professional indemnity insurance

July 30, 2010 · Filed Under Management Consultant Professional Indemnity Insurance · Comments Off 

You may have already done your homework when setting up your business and know all about choosing management consultants professional indemnity insurance. However, if you are not sure what this is and what the benefits may be, then read on.

What protection does a policy offer?
In short, management consultants professional indemnity insurance provides protection to management consultant businesses in the event that they are sued and taken to court.

While we all do our very best to be professional, there may be times when a mistake occurs and these mistakes may be very costly.

Excellent book keeping may pay off
Whether you are running a small or large business, it pays to learn the skills of book keeping and documentation. Always ensure that any contracts have been well planned and you have made sure the client knows what your responsibilities are. You may wish to give careful attention to how you lay documents out and make a note of everything that you do for your clients. This might typically include detailing times and dates and exactly what you did. In the event of someone claiming against you this documentation may then be used to show exactly what happened and whether you did something that negatively affected your client.

Do providers all offer the same?
When you go looking for management consultants professional indemnity insurance, you may wish to bear in mind that not all insurance providers typically offer the same elements of cover.

For example, some insurance providers might offer higher maximum amounts if you were to claim, while some providers may give you what you perceive to be more for your money than others.

Typically a policy may protect you against the following, depending of course on the provider and the level of insurance you choose;

  • slander and libel cases;
  • public liability insurance may be included or you might need to pay more to have it added on;
  • defamation of character;
  • losing documents or data belonging to a client;
  • dishonesty;
  • accidental breach of confidentiality;
  • infringement of intellectual property rights deemed unintentional.

When choosing management consultants professional indemnity insurance, you might be saving yourself from a lot of stress and financial worry if the worst were to happen and a claim were made against your company.

Finding management consultants professional indemnity insurance

May 26, 2010 · Filed Under Management Consultant Professional Indemnity Insurance · Comments Off 

It has to be acknowledged that management consultants professional indemnity insurance isn’t a description that trips lightly off the tongue! Yet the name is far more complicated that the reality.

The risks of being sued for professional activities

It would be nice to think that we can engage in our professional activities without the need to worry about the threat of legal action but sadly that may be a risky approach.

The reality is that as a management consultant, you work closely with clients and provide them with your advice and guidance to help them in their decision-making and business transformation.

If everything goes well, you typically will look forward to receiving your fees and hopefully, your client’s sincere appreciation for your services.

If things go wrong though, in addition to forgetting the praise, you may also need to anticipate legal action for damages of the generic professional negligence type.

Management consultants professional indemnity insurance may help you cover the potential costs of that possibility.

Risks covered

Typically, this form of protection exists to help with the financial costs you may face from legal actions and court awards arising from accidental or professional negligence. It may be important to note that typically this would not cover instances where you or members of your staff were guilty of intentional acts.

These types of policies may be able to offer you cover for things such as the loss of confidential client documents or data, slander, accidental contraventions of intellectual property rights, late delivery claims, libel and unintentional breaches of contract.

If this sounds to be something akin to overkill, then it might be prudent to remember that courts do not necessarily decide on damages based upon intention – they are more likely to be influenced by the losses sustained by your client. In other words, even if the incident was entirely accidental, you may still find yourself facing a huge compensation bill.

Insurance to help you sleep easy at night

If you’re engaging in professional activities then the cost associated with management consultants professional indemnity insurance may be a small price to pay for having that financial support in place.

What is management consultants professional indemnity insurance?

April 23, 2010 · Filed Under Management Consultant Professional Indemnity Insurance · Comments Off 

Management consultants professional indemnity insurance is a form of insurance cover designed specifically for business people and professionals. It looks to offer you financial protection should you be sued for any one of a number of specified reasons.

Why would I be sued?

It doesn’t matter how careful and conscientious you are in the practice of your management consultancy, there is always the possibility that something will go wrong for either you or one of your staff.

It doesn’t take much to suddenly find you’ve an irate client on your hands.

If you think that’s bad, it’ll be as nothing compared to the troubles you may face if your client is sufficiently angry to sue you for damages under any one of a number of headings.

In today’s business world people are perhaps more inclined than ever to attribute blame when things go wrong and to seek compensation – that’s how you could end up in court. Even if your client (or probably ex-client by this stage) fails to win their case, you may still find a huge legal bill landing on your desk.

In a nutshell, that’s why management consultants professional indemnity insurance exists – to typically help meet the financial costs and awards associated with such legal actions.

Where am I vulnerable?

Your legal exposures may vary depending upon the exact nature of your business but typically include you being at risk of being sued due to:

  • breaching confidentiality (accidentally);
  • libelling or slandering a third party or client;
  • delivering a solution that caused consequential damages (product liability);
  • accidentally infringing intellectual property rights;
  • losing critical client data or documents;
  • public liability-related accidents.

This is far from a comprehensive list. If you are sued for any of the above reasons or others, then you may be making some very large payments unless you are covered for an insured-risk through a management consultants professional indemnity insurance policy. (Do note that in relation to the alter bullet point, public liability insurance may not always form part of a professional indemnity insurance policy and may have to be bought as standalone cover, so always check the policy wordings).

Would I be covered against everything?

All insurance policies of any type carry details of the insured risks, exclusions and conditions. It is typically highly advisable to read these carefully.

Some policies of this type may exclude cover under some categories of risk should you be proven to have intentionally committed an offence such as the deliberate publication of client confidential information.

Isn’t it expensive?

Little if any insurance is ever free but the cost must be weighed against the risks you run by continuing your business uninsured or under-insured.

Doing without cover may continue to appear to be the right thing to do – right up until you encounter a problem and are sued.

Management consultants professional indemnity insurance may be surprisingly attractively priced if you think about it in the context of the sums that may be awarded against you by a court or tribunal!

Points to note when buying management consultants professional indemnity insurance

March 31, 2010 · Filed Under Management Consultant Indemnity Insurance, Uncategorized · Comments Off 

If you run a management consultancy business, you may think that nothing will ever go wrong – for example, you will never be sued; an employee will never act dishonestly; or you will never be accused of negligence. However, some things are beyond our control and things can, and do, go wrong. Management consultants professional indemnity insurance is designed to help protect you and your livelihood in circumstances such as this by protecting your business in respect of any legal liability which arises out of its exercise and conduct.

What are its benefits?

There are different types of professional indemnity insurance (PI insurance) and, often, different levels of cover too, which can help protect you and your business against the financial fallout of a claim being made against you (this may include any legal defence costs and help with damages awarded to the third party – up to the policy limits of course).

What to look for when buying cover

As highlighted above, there can be differing levels of cover depending on the PI insurance policy you buy including whether it is trade-specific (eg insurance for management consultants).

Things to look out for when comparing management consultants professional indemnity insurance may include:

  • checking how much any excess would be in the event of a claim. Most professional indemnity policies will have an excess if you make a claim;
  • the sum insured (ie the amount of cover you have) is of great importance as being under insured means you will have greater financial responsibility should a claim be made against you. Some of your clients may insist that you have a minimum sum insured in order to provide them a service, so do check;
  • ensuring that your policy covers all time frames. Often, there may be a delay between an event and the subsequent claim. For example, if you are in the middle of changing insurers, ask your new PI insurance provider if they will accept new claims for prior incidents. This is often known as retroactive period;
  • finally, remember when comparing policies that the terms and conditions of the insurance can differ depending on the providers. Therefore, always ensure that you check them to confirm the pertinent points of the insurance.

Having the peace of mind that you have management consultants professional indemnity insurance in place can help you focus on the most important thing – running your business.

What is management consultants professional indemnity insurance?

February 1, 2010 · Filed Under Management Consultant Professional Indemnity Insurance · Comments Off 

What is management consultants professional indemnity insurance? Also known as PI insurance or PII, this protects companies offering advice or consultancy services. In some industries, having professional indemnity insurance will often form part of a contract between a supplier and the client in order to protect both parties against financial loss that occurs as a result of error or omission.

This may typically include things like:

  • a negligent act;
  • libel and slander that is unintentional;
  • infringement of intellectual property rights that is unintentional;
  • loss of documents or data;
  • unintentional breach of confidence or misuse of information.

These are all things that can happen, even to the savviest of business people with the best staff. And if you or your management consultants company is sued for damages as a result of one of these things, then:

  • your reputation could be destroyed;
  • unless you have PI insurance in place, you will have to pay for the costs of defending yourself and any awards made to the other party.

Management consultants professional indemnity insurance can typically help your business at times like this by providing assistance so that you do not lose out financially. (Of course, there is usually a pre-agreed excess that you will be liable to pay and limits to claim amounts). The alternative – funding the costs yourself – could see you seriously deplete your firm’s financial reserves or even see it go under.

The FSA definition of professional indemnity insurance

The independent non-governmental body the Financial Services Authority (often referred to as the FSA) defines professional indemnity insurance as “a liability insurance that covers businesses in the event that a third party claims to have suffered a loss as a result of professional negligence”. In layman’s terms, this means that the management consultants professional indemnity insurance can typically step in and cover at least some of any financial losses incurred by a company – subject to the claim being accepted by the insurer of course.

As with all insurance policies, management consultants professional indemnity insurance policy benefits and features can vary depending on who you buy your cover from, so do check the small print so that you fully understand what the PII cover provides. If you have any doubts, contact your provider.

Management consultants professional indemnity insurance explained

January 22, 2010 · Filed Under Management Consultant Professional Indemnity Insurance · Comments Off 

Perhaps you have heard of management consultants professional indemnity insurance and wondered if it is worthwhile?

The risks you face

Did you know:

  • that a client could sue you if you provided professional advice that subsequently proved to be materially inaccurate and which caused them losses as a result?
  • you could be held accountable and sued for damages if you accidentally release confidential information belonging to a client into the public domain?
  • that a third party could sue you if you accidentally use materials that are their intellectual property right without their permission?
  • you may easily be sued for libel, slander or defamation of character, if your verbal or written observations that are critical of others are leaked to the parties concerned?
  • that someone accidentally injured as a result of your activities (e.g. a collapsing chair in your office or tripping over your equipment) could sue you for damages under the provisions of ‘public liability’?

However unlikely you believe these events may be, in reality something like this or similar happen. And then you could end up in Court. Courts have little sympathy for excuses along the lines of “it was unintentional” and may make punitive financial awards against you based upon their perception of the damage suffered by the other party.

Management consultants professional indemnity insurance

Professional indemnity insurance coupled with public liability insurance is designed to protect you from the financial consequences of the above risks.

The amount of cover is variable depending upon your requirements and, of course, the higher the level of cover required, typically the more expensive the premium will be.

Deciding what level of cover you may realistically require will vary depending upon the nature of your business and to some extent, the extent to which you are prepared to live with risk.

Guessing is typically not a good idea. There are specialist providers of professional indemnity insurance offering their products over the Internet. Their sites typically offer a wealth of information and the opportunities to obtain fast quotations.

So, if you don’t like running your business on a day-to-day basis hoping that you ‘stay lucky’, finding out more about management consultants professional indemnity insurance may be a sensible move.

Management consultants professional indemnity insurance explained

December 26, 2009 · Filed Under Management Consultant Professional Indemnity Insurance · Comments Off 

Perhaps you have heard of management consultants professional indemnity insurance and wondered if it is worthwhile?

The risks you face

Did you know:

• that a client could sue you if you provided professional advice that subsequently proved to be materially inaccurate and which caused them losses as a result?
• you could be held accountable and sued for damages if you accidentally release confidential information belonging to a client into the public domain?
• that a third party could sue you if you accidentally use materials that are their intellectual property right without their permission?
• you may easily be sued for libel, slander or defamation of character, if your verbal or written observations that are critical of others are leaked to the parties concerned?
• that someone accidentally injured as a result of your activities (e.g. a collapsing chair in your office or tripping over your equipment) could sue you for damages under the provisions of ‘public liability’?

However unlikely you believe these events may be, in reality something like this or similar happen. And then you could end up in Court. Courts have little sympathy for excuses along the lines of “it was unintentional” and may make punitive financial awards against you based upon their perception of the damage suffered by the other party.

Management consultants professional indemnity insurance

Professional indemnity insurance coupled with public liability insurance is designed to protect you from the financial consequences of the above risks.

The amount of cover is variable depending upon your requirements and, of course, the higher the level of cover required, typically the more expensive the premium will be.

Deciding what level of cover you may realistically require will vary depending upon the nature of your business and to some extent, the extent to which you are prepared to live with risk.

Guessing is typically not a good idea. There are specialist providers of professional indemnity insurance offering their products over the Internet. Their sites typically offer a wealth of information and the opportunities to obtain fast quotations.

So, if you don’t like running your business on a day-to-day basis hoping that you ‘stay lucky’, finding out more about management consultants professional indemnity insurance may be a sensible move.

Typical management consultants professional indemnity insurance features

November 22, 2009 · Filed Under Management Consultant Professional Indemnity Insurance · Comments Off 

A few sensible safety nets may be useful for businesses, particularly if dealing with high profile management decisions. Management consultants professional indemnity insurance may help to protect a professional adviser against unwanted legal claims – and is normally quite flexible in its policy features and costs.

Professional indemnity cover is compulsory for a number of types of business – financial advisers, accountants, and architects may find it is necessary in order to gain membership of professional groups, or to comply with the law. For other types of consultant it may not be strictly compulsory, but may be more than sensible if a company has little other protection in the event they are faced with a court case.

An insurance policy like this may apply to one freelance individual or to a whole company, and normally pays out cash towards legal defence fees and compensation costs which result from a client complaint that you have made an error, omission, or act of negligence in your work.

To give an example a management consultant might be hired to temporarily run a department in an effort to improve its performance. If their decisions, in the opinion of the client, result in the department actually losing the company money, they may decide to take legal action and recover what they have lost.

In such circumstances a consultancy which does not have protection may normally effectively have to pay for their legal bills and compensation themselves, and some cases may run into hundreds of thousands or millions of pounds.

This of course may bankrupt a good deal of companies, which is why management consultants professional indemnity insurance may be a worthwhile option.

It normally involves a payout limit beyond which the insurance company may not cover any further costs for legal defence or compensation. This limit is important because it may run out in the middle of a particularly lengthy case and leave the policyholder picking up the rest of the bill. This is why top cover limits on many policies stretch to hundreds of thousands or millions of pounds.

Not every consultancy may need the same level of protection, however, and a degree of judgement is needed to asses how much protection is really necessary – a freelance working with medium-sized clients may want a higher level of protection than a large consultancy dealing with international firms with large turnovers, for example.

Besides errors, this form of protection normally also pays out in the event you are sued for defamation, or for other incidents such as if you lose important data or documents belonging to a client. Besides this it may protect against claims that you or your employees have acted dishonestly, and perhaps defrauding a client, for example.

Often extra options may be arranged, such as what is known as runoff protection, providing extra cover for when the company is in between insurers, or for when a consultant is winding down the business.

Crucially, management consultants professional indemnity insurance does not typically require that the claim against you is false in order for a payout to be made. Provided any mistake is unintentional, and not malicious, it may well be covered by the protection even if the claimant’s allegation is entirely true.

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