Should you make a mistake, which causes your client to lose money, you will want to be the proud holder of a professional indemnity insurance policy. This form of insurance covers compensation claims by your client in addition to all reasonable costs relating to the defence of the claim, such as legal expenses. This form of insurance will protect you against the following risks:

- Destruction or loss of professional work data If documents or other forms of data (which belong to a client) are damaged, destroyed, or rendered missing while in your possession.

- Theft If an employee is found to have stolen money, or been otherwise untruthful.

- Legal property rights If creations of the mind, both artistic and commercial (which belong to others) are found to have been imitated or submitted by you as having been created by you.

- Negligence If you fail your client by providing erroneous advice or improper direction.

One of the finest aspects of professional indemnity insurance comes into play should you find yourself in a predicament where a dispute with a client arises and your company’s reputation is at risk. No matter how reputable your company is, absolutely any company can find themselves exposed to financially crippling claims and reputation spoilage. We live in litigious times and businesses can be sued, rightly or wrongly, for tremendous damages spanning quite a range of complaints. That is simply the truth of the matter, and this reality should not be ignored when you are assessing proper coverage for your company.

In some cases professional indemnity insurance is compulsory. However, everyone who provides advice or consultancy services should consider professional indemnity insurance. The risk is just to great for you not to be educated as to what is available and what could ultimately be a critical investment.