Professional indemnity insurance is designed to protect your business from any claims arising from negligent advice or services. This covers people working for a business that involves risk.
Professional indemnity insurance policies are bought by business owners to protect their companies from financial liability in case of negligence claims. Under this, the person is assisted by professional indemnity insurance in case of a lawsuit. Executive liability indemnity can help cover attorney fees, court costs, and any resulting settlements, decisions or fines.
Image Source: Google
Until the professionals got this insurance, they had transferred their liability to the insurance company. The company will now be the one to cover the legal fees when a suit against an insured professional is brought.
Given the cost of thousands of dollars, it is beneficial for them when they personally charge legal fees. Yet insurers are required to investigate claims made against their customers where they pay an award amount equal to the coverage policy limit if the insurance policy is found liable in court.
There are various types of insurance plans such as errors and omissions, and professional liability policies that are considered as professional indemnity policies.
However a professional may be granted or rejected by an insurance company upon applying for professional indemnity insurance for several reasons. These factors may include business location, claim history, industry, and the coverage amount.
The degree of risk reflected by the premium amount is determined by these factors. If a professional is given a policy but has a higher risk than standard applicants, the insurance company will increase the premium.