Why do business consultants need professional insurance coverage? Is professional non-life insurance necessary for business advice?
This article aims to provide why a business consultant needs professional non-life insurance. But before we go into why, let's discuss what occupational injury insurance is.
What is professional non-life insurance?
Professional non-life insurance (PII) is available in different names while maintaining the same structure and framework. It is also called professional liability insurance (PLI) while in the United States it is often called non-life insurance.
Whatever name you come across, professional non-life insurance is an insurance that provides legal support when you receive lawsuits against you by clients who are dissatisfied with your services or feel that you did not provide as much quality and value as they expected you to. provide.
Whether the error was due to your sincere remorse or a misconception from the customer, an action can be brought against your company.
The insurance policy that covers the legal debts is called occupational injury insurance or what is commonly called an insurance policy for errors and omissions in the United States.
If your job description is to provide advice or a position as a business consultant, occupational injury insurance is an important insurance cover for you. It will protect you from bearing the total cost of an alleged negligence claim filed by a client.
This insurance coverage focuses on a breach of trust in a consultant who provides the client with accurate information to assist the client in the decision-making process.
A client may file a lawsuit when he or she feels that your consulting firm is the cause of their failure. In addition, the client may feel that you omitted some important facts when they advised you and thus the brains behind their failure.
The occupational injury insurance policy covers all financial losses that your client may have suffered due to the assumed error or omission on your way as a business consultant.
Generally, liability insurance can be considered to cover these scenarios, but its provisions do not fully insure your business from these risks. Professional non-life insurance is designed to cover companies that face this type of risk.
Will an occupational injury insurance cover criminal prosecution?
An occupational injury insurance or liability insurance does not insure criminal prosecution. Nor does it cover any form of legal liability under civil law other than those clearly stated and identified in the insurance policy by the insurer.
Why do business consultants need professional non-life insurance?
No matter what your intentions as a business consultant, services and the offer of professional advice will not always end on the positive side.
Human desires that we have learned from basic economics are insatiable and so is the provision of services. People will not always be completely satisfied with the services you have offered.
The accident is even on the lighter side, an advice you give or a service you provide can be the customer the cause of his or her failure and possible losses. Such an event can put you and your business under serious financial strain.
This is because you may be asked to pay for the loss that the client has incurred after following your advice or if he is dissatisfied with your service, the client may request a refund of the money he or she paid or a compensation.
You can not completely avoid situations like these regardless of the expertise and skills you have acquired as a business consultant. Even if you have become a force to be reckoned with as long as business consultants touch, you may still encounter these problems. The best of the best are not excluded.
With how narrow the chances are of never facing these problems, every business consultant needs professional non-life insurance. With professional non-life insurance, you can continue your business consultant with the assurance that legal debts and customer satisfaction are taken care of even before they arise.
The following are reasons why a business consultant needs professional non-life insurance:
1. General liability insurance is not a perfect cover for business consultants
General liability insurance does not fully cover the risks and threats that business consultants face. Do not make the mistake of thinking that your general liability insurance is sufficient to cover your consulting insurance needs.
The general liability insurance does not compensate you when customer satisfaction problems arise.
It is good that you have a general liability insurance for your consulting company, having occupational injury insurance is crucial and must not be overlooked.