Professional Indemnity Liability Insurance
Professional Indemnity Liability Insurance
What is liability insurance?
If you work for a company, you are insured by them as their employee. When something doesn't go right, like a lawsuit is filed against the company because of you, the company is responsible for taking care of it.
What kind of things does it cover?
Liability insurance is what covers most claims against a company for injury or damage that happens:
- If their are flaws in the product
- If their are flaws in the service provide
- On the company property
What if I own my own business or I'm self-employed?
If you have your own business, you obviously don't have an employer to give you this type of protection. You need to protect yourself from any potential problem that might be too much for your little company to handle.
So what kind of home business needs this kind of insurance?
What if you operate a consulting business out of your home. If a client comes to your office for a consultation and slips on the front step and injures himself, he could sue you. If he does sue you, you are in a bad predicament. You may end up paying for:
- Medical fees
- Lost wages
- Compensation
- Legal fees
Paying for these kind of fees will probably be difficult, if not impossible, without the bankruptcy of your company. In fact, you could possibly lose some of your personal assets as well.
So self employment or home business insurance can protect me from this?
Self employed or home business liability insurance policies will protect you from things that are business related in your home. You can look into different policies and choose one that will provide you the coverage you think you need. Expect he coverage to have a limit up to which it will cover rewards and legal fees.
Should I look on-line or go to an agent?
Both, but for this type of insurance, but an agent can really help you make a well educated decision about which policy is best for what you are doing.
Are there any other options?
Sure. Another good option is to have a personal umbrella insurance policy. Now, these can actually be good for anyone, not just the self employed or small business owner. They are good because they provide additional protection of your personal assets not related to your company.
Alright, so what does the umbrella policy do?
The personal umbrella liability insurance policy provides protection above the limits of other policies you have. So, let's say you have home-owner’s insurance with a limit of $450,000 and a flood causes $600,000 in damage, your personal umbrella policy will cover the rest. It is not very expensive, but can mean the difference between losing your business, even though you had insurance. It is also nice not having to pay anything out of pocket.
So, what is the best solution? The bottom line...
You need to do what fits your company best, but if you have self employed or home business liability insurance and a personal umbrella policy in place, you can sleep at night knowing that you are not at risk of losing your whole business due to an accident or mistake.
Professional Indemnity Liability Insurance
