GROUP 10

NAMES: ADITI KHAITAN (A005)

AKSHAT MALVIYA (A011)
TOPIC – PROFESSIONAL INDEMNITY
POLICY
 What Is Professional Liability Insurance?

Professional liability insurance (PLI) is insurance that protects

professionals such as accountants, lawyers, and physicians against
negligence and other claims initiated by their clients. Professionals
who have expertise in a specific area require this type of insurance
because general liability insurance policies do not offer protection
against claims arising out of business or professional practices such as
negligence, malpractice, or misrepresentation.
• Professional Indemnity insurance is designed for professionals
who provide advice or a service to their customers.
• It protects you against legal costs and claims for damages to
third parties which may arise out of an act, omission or breach
of professional duty in the course of your business.
• If a mistake or omission occurs in the course of your work that
results in financial loss or injury to a third party (e.g. a customer)
—that customer may take legal action against you to recover
their losses.
• Professional Indemnity insurance seeks to protect both your
assets and your reputation, should this occur.
 Why do I need it?
Defending yourself from a professional conduct claim can cost you
time, money and damage your reputation, regardless of whether the
allegations are founded or not. If things do go wrong you could be held
responsible not only for your own actions but for those of your
partners, employees or volunteers.

All dance professionals need to ensure they are protected against

unfounded allegations as well as breaches of professional duty. A
Professional Indemnity insurance policy safeguards you and your
business by providing cover against such claims, including the cost of
defending the action—so you can conduct your business with the
confidence that both your assets and your reputation are protected.
 Who is covered by Professional Indemnity
policy?

A Professional Indemnity insurance policy should cover

not only your business but also any principal, employee,
director, partner or related entity whilst acting with the
scope of their duties.
 Is professional indemnity insurance a legal
requirement?
• Professional insurance is not a legal requirement for businesses. In
fact, the only business insurance that’s required by law is employers’
liability insurance, which is a legal requirement for most businesses
with staff.

However, professional indemnity insurance is mandatory for members

of some professional bodies and is required by some regulators.

• This means it’s effectively compulsory for some professions. This

includes solicitors, financial advisers, accountants, architects and
some healthcare professionals.
 Businesses that buy professional indemnity
insurance
• Even if professional indemnity insurance isn’t compulsory for your
business, you may decide that it’s an important insurance to have.
• It can pay claims made against you for negligence or making a
mistake in your work. This means that it’s a particularly important
insurance for any business that gives advice, provides a professional
service, and/or handles client data and intellectual property.
• This makes it popular with businesses like IT consultants, designers
and tutors.
 How long does professional indemnity
insurance last?

A professional indemnity policy will potentially cover liability in

both contract and tort. Clients can sue for negligent acts within
six years of the work being finished - the time limit for a claim
under breach of contract.
 What is the cost of professional indemnity
insurance?

Professional indemnity Insurance cost for sole traders, and

consultants and start from $380. Some examples of pi costs are
below: Professional indemnity cost for some sole trader
consultants providing low risk advice : from $350. Professional
indemnity cost for I.T.
THANK YOU!!