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What is Indemnity Insurance?

 

Indemnity insurance or professional indemnity insurance is a type of insurance policy which is designed to shield professionals and business owners if they are found to be guilty of some event such as misjudgement or some other professional risks. Indemnity insurance is also called as professional liability insurance. It provides cover for the claim of providing inadequate services, advice, design, etc. against the insured. Liability insurance also covers the compensation that is payable to the client for correcting the mistake.

 

Need of Professional Indemnity Insurance

 

While working as a professional, it is always a possibility that you or your colleague could make a mistake, regardless of the experience. So, it is a good option to have a liability insurance if you regularly work with clients or businesses and Handle their work, data, intellectual property or even provide them with professional services or advice. The indemnity insurance covers you and your firm from facing financial losses if a claim is made against you or your company. Thus, having a professional liability insurance which adequately covers your organisation is a safe option while doing a day to day business.

 

Professional Liability Policy Covers

 

An indemnity policy covers the following Range of scenarios –

 

  • • Professional negligence
  • • Loss of data or other documents
  • • Loss of goods and/or money
  • • Unintentional breach of confidentiality or copyright
  • • Claim investigations expenses
  • • Defamation

 

Who Can be Insured Under the Professional Indemnity Insurance?

 

This policy can be taken by –

 

  • • Doctors and medical practitioners like surgeons, pathologists, etc.
  • • Engineers, contractors, architects, etc.
  • • Hospitals, clinics and nursing homes
  • • Lawyers, chartered accountants, counsellors, advocates
  • • financial advisors, management advisors, etc..

 

Exclusions from the Professional Liability Insurance Cover

 

There are certain exceptions which are not covered by the indemnity insurance. Let us take a look at those –

 

  • • Criminal acts, frauds and other law violations.
  • • Being under the influence of drugs or alcohol while rendering the service.
  • • Intentional damage
  • • Contractual liability
  • • Act of war or terrorism
  • • Insolvency of the person with indemnity insurance.

 

Top Insurance Companies that Provide Liability Insurance

 

  • • New India Insurance
  • • Reliance General Insurance
  • • United India Insurance Company
  • • ICICI Lombard Insurance Company
  • • Tata AIG Insurance.

 

Source: Fincash

3 Reasons to Insure Yourself this Pandemic | Deeva Ventures Pvt Ltd

3 Reasons to Insure Yourself this Pandemic

As we said at the start, most people think insurance is an unnecessary expense. The reason is that we feel confident about our future and our ability to tackle unseen circumstances.


But there is a huge difference between our perceived ability and reality. For instance, a few years of savings can vanish in case of a medical emergency.


1.  Insurance ensures the family’s financial stability

No matter how much you have managed to save or what your monthly income is, an unexpected event can burn a huge hole in your pocket or can simply jeopardize your family’s financial future. 


For example, if you do not have adequate life insurance, your family might have to go through financial hardship if you were to meet with an untimely death.


Though no amount of money can replace the loss of loved ones, having life insurance would save them from going through financial hardship.


Meanwhile, if you or your family do not have enough health insurance, then huge medical bills during any treatment can completely shake your finances. 


So you must cover yourself, your family with an adequate amount of insurance. 


2. Insurance brings peace of mind

The premium you pay to the insurance company is the price that guarantees that the insurance company will cover the damage in case of an unforeseen event.

And, that guarantee that your risk is covered brings peace of mind. 


For example, let’s suppose you die an untimely death at a time when you still have several milestones to achieve like children’s education, their marriage, a retirement corpus for your spouse, etc.


Also, there is debt as a housing loan. Your untimely demise can put your family in a hand-to-mouth situation.


But, if you would have bought term insurance considering all these factors, your family would be able to sail through the hard times. 


3. Insurance reduces stress during difficult times

No matter how hard you try to make your life better, an unforeseen event can completely turn things upside down, leaving you physically, emotionally, and financially strained.


Having adequate insurance helps in the sense that at least you don’t have to think about money during such a hard time, and can focus on recovery. 


For example, suppose you or someone in your family had a heart attack and needs immediate hospitalization. Such treatments at good hospitals can cost lakhs.


So having health insurance in this case, saves you the worries and stress of arranging money.  


With insurance in place, any financial stress will be taken care of, and you can focus on your recovery.


Conclusion: 

Having insurance – life, health, and liability – is an essential part of financial planning. It can save you from financial hardship in case of any unforeseen circumstances. 


However, the decision to buy insurance should be determined by three factors – requirement, the benefits you get from the policy, and your ability to pay the premium. 


Why you need Liability Insurance

Why you need Liability Insurance

This type of insurance policy is generally procured by companies or individuals who may be held liable, legally for injuries or other issues. This especially the case for hospitals, doctors, or even business owners.

 

An example would be, if a product manufacturer sells products that have been faulty or cause damage to other’s products, then he/she may be sued for the damages caused.

 

Procuring liability insurance will cover the manufacturer from ensuing legal costs.

Liability insurance is one part of the general insurance policy itself under the risk transference category. 

 

In many countries, liability insurance is mandatory especially for drivers of public transport vehicles. The scope of this form of insurance in India has been defined by the Public Liability Insurance Act of 1991.

 

Liability Insurance Plans:

  • Public Liability Insurance
  • Product Liability
  • Employer Liability
  • Third-Party Liability
  •  

How is the Premium Amount Decided?

The premium that is to be paid by the insured will be worked out using the base rate based on the insurance company’s needs and assessments. 

 

Another factor that is taken into consideration is the amount of risk that the company and its products come with. The higher the risk, the higher is the premium to be paid.

 

Claim history, size of the risk, and the company’s approach to the risk are additional factors.

 

While deciding the premium amount, insurance companies take into consideration the environment, the number of claims made previously, and their business record.

 

Companies Providing Liability Insurance Policy are:

Several companies within India provide different forms of liability insurance covers. Some of these are –

 

  • HDFC Ergo Commercial General Liability – this insurance policy protects against claims of property damage or bodily injury for which the company is liable.
  •  
  • ICICI Lombard offers numerous liability insurance covers to suit business requirements.
  •  
  • Bharti AXA Commercial General Liability Policy offers cover for liabilities that are a result of business processes and operations.
  •  

Liability Insurance Claim Process:

The claims process varies from one company to the other. There is generally a form to be filled for the same post which all necessary documents will have to be provided.

 

However, when it comes to liabilities it is not as simple. There may be court cases or an out-of-court settlement. 

 

The claims process will be different based on what the claim is being made for.