Monday, 24 December 2012

Buy Professional Indemnity Insurance

Buy Professional Indemnity Insurance

By Chris Carvill

Information has been recently released showing that public sector IT contractors are in line to face some serious professional indemnity claims over substantial amounts of data loss. When it comes to those working in IT, data loss is a huge issue regarding claims, and this highlights the importance of a policy such as professional indemnity insurance.

Contracting as a profession ranges from a number of different industries, each differing in risk levels and safety. With a policy that protects professional indemnity, one would think that the higher the obvious risk, the bigger the need for protective insurance. But this isn't often the case. Contractors, as mentioned before, can exist in many different industries, some may be rope access oil rig workers, and others may work behind a desk, but regardless of any immediate dangers, insurance is just as necessary for each.

This recent case of public sector contractors working within IT shows that their professional indemnity is being tested, with claims being carried out as a result of masses of data being lost due to professional error. This kind of error could have been caused for a number of reasons, perhaps simply a technical glitch, or maybe because of some slight anomaly or mistake that was made, but regardless of the cause, the outcome could result in some seriously hefty claims. This case is reminiscent of the substantial banking blunder that occurred earlier in the year, where their networks crashed for weeks due to a simple IT slipup. Concerning IT as a profession, the potentialities of professional error are arguably low, but when you look at cases and statistics regarding professional insurance claims, it becomes clear that there is a lot of room for error in such a line of work.

To buy the policy, professional indemnity insurance is a very cheap product, and because of this, a little really does go a long way. With premiums starting as low as �147 per annum, this amount is a very small price when considering the possible claims that can be filed against the policy holder, and when looking at recent cases concerning negligence claims, the importance of the product is clear. When buying anything, it is always advised that you ensure that it is the right product for you, this can be said about anything, CD's, clothes and even a car, and insurance is no different. Professional indemnity cover differs depending on the level of insurance the buyer needs, professions and limits of indemnity making a large impact on the end premiums.

The recent cases of claims being carried out due to the actions of IT contractors reiterate the importance of professional indemnity insurance as a form of contractor cover, proving that it is a necessary policy as well as being an essential form of protection. It is not just those who work within IT that require professional indemnity insurance, but in light of negligence claims, it just shows how such a relatively low risk profession can create such substantial financial losses for a company.

Chris Carvill is employed by Qdos, a Leicestershire-based provider of Professional Indemnity Insurance for UK freelancers and contractors. The Qdos website offers includes information about what IR35 is and a handy IR35 calculator to help you find out the potential impact of IR35 on your work.

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