professional indemnity insurance in bangladesh

What is professional indemnity insurance?

Professional indemnity insurance (PI insurance) is a type of insurance that protects businesses and individuals from financial losses arising from claims of negligence, breach of duty, or error and omission in the performance of their professional services.

What does PI insurance cover?

PI insurance typically covers the following costs:

• Legal defense costs, including the cost of hiring lawyers and experts
• Damages or compensation awarded to the claimant, if the insured is found to be liable
• Other associated costs, such as the cost of investigating the claim and repairing any damage

Who needs PI insurance?

PI insurance is recommended for any business or individual that provides professional services. This includes professions such as:

• Accountants
• Architects
• Engineers
• Lawyers
• Doctors
• Financial advisors
• IT professionals
• Consultants
• Contractors
• Surveyors
• Real estate agents
• Insurance brokers

Why is PI insurance important?

PI insurance is important because it can protect your business or personal finances from the potentially devastating costs of a professional indemnity claim. Even if you are very careful, there is always a risk that you could make a mistake or provide incorrect advice. If a client suffers financial losses as a result, they could sue you. Without PI insurance, you would be personally liable for all of the associated costs.

Here are some examples of how PI insurance can help:

• An accountant makes a mistake in a client's tax return, which results in the client having to pay additional taxes and penalties. The accountant's PI insurance would cover the cost of defending the claim and any damages or compensation that the client is awarded.
• An architect designs a building that is structurally unsound, and the building collapses, causing damage to neighboring properties. The architect's PI insurance would cover the cost of defending the claim and any damages or compensation that the neighboring property owners are awarded.
• A lawyer gives their client incorrect advice, which leads to the client losing a court case. The lawyer's PI insurance would cover the cost of defending the claim and any damages or compensation that the client is awarded.
• A doctor makes a mistake during a medical procedure, which results in the patient suffering an injury. The doctor's PI insurance would cover the cost of defending the claim and any damages or compensation that the patient is awarded.
• A financial advisor invests a client's money in a risky investment without the client's knowledge or consent, and the client loses money. The financial advisor's PI insurance would cover the cost of defending the claim and any damages or compensation that the client is awarded.
• An IT professional accidentally deletes a client's important data. The IT professional's PI insurance would cover the cost of defending the claim and any damages or compensation that the client is awarded.

How to choose PI insurance

If you are considering taking out PI insurance, it is important to compare quotes from different insurers and choose a policy that provides the right level of coverage for your needs. You should also make sure that the policy includes a retroactive cover clause, which will protect you against claims arising from work that you did before you took out the policy.

Here are some things to consider when choosing PI insurance:

• The type of professional services that you provide
• The size and complexity of your business
• The value of your clients' assets
• The level of risk associated with your work
• Your budget

It is also a good idea to speak to an insurance broker who can help you to assess your needs and find the right PI insurance policy for your business.