Compare professional indemnity insurance

Professional indemnity insurance is designed to protect businesses that offer services to others. If a client is unhappy with the service they’ve paid for, professional indemnity insurance should protect you against a claim for damages. For example, a client may claim they’ve lost money as a result of the advice you’ve given them.

Alternatively, you could be sued for lost documents or data or even for defamation. The range of companies that are potentially at risk – without professional indemnity insurance – is vast. 

This cover is not a legal requirement for all businesses. But it may be required if you’re part of a trade body or subject to industry regulation, and some clients will only work with firms that have it. The right policy can cover expensive claims that could otherwise cost your business thousands in legal fees.

Professional indemnity insurance can be useful for services that include design work, accountancy and financial advice or even marketing and surveys. It's also worth bearing in mind that you could still face a claim even if you provided your services for free.

Professional indemnity insurance works best when the policy is tailored to your business needs, so you have an assurance that you’ll be covered should the worst happen without paying more than you need to. 

Once you’re happy that the policy covers your business, you’ll need to check the excess to see how much it’ll cost you if you’re sued. This type of insurance is usually centred around the claim, as it will only cover you for cases brought against you during your policy term.

Professional indemnity insurance is not a legal requirement. But that doesn’t mean you don’t need it. This cover is highly recommended if your business offers a professional service to clients who could sue you should something go wrong. 

If you offer advice to clients that might result in them losing money, you could be sued. Similarly, if you mishandle their private and confidential details, resulting in sensitive information being revealed, you could expect a court case. 

Likewise, if you damage a client’s property or their reputation through your actions or correspondence, you may face a legal claim. All this can prove very expensive if you don’t have adequate professional indemnity cover in place.

Here are some, but certainly not all, types of businesses that might need to secure this type of insurance: 

• Financial advisers

• Architects 

• Accountants 

• Advertising 

• Journalism

• Graphic design

• Solicitors

The cost of this insurance will vary, depending on the size of your business and the type of business you run, among other factors. The insurance quote will also take into account your annual turnover, your claims history and the limit of indemnity you need. You’ll also need to decide how much excess you are willing to pay as this will contribute to the final cost. 

As with most policies, price shouldn’t be your main priority. Cheap insurance could end up costing you more if it doesn’t provide the cover you need. To get the best deal, look for insurers that allow you to tailor your policy to your needs so you're not left over - or under-insured.

For some industries, it’s a requirement to have professional indemnity insurance in order to work with certain clients, and they may ask to see your insurance certificate.

Even though it’s not a legal requirement, the decision to take out professional indemnity cover could make a lot of sense. If you decide not to have it and someone makes a claim against you then you could face hefty legal fees, and your business would become exposed.