Although professional indemnity insurance is prescribed by law for certain businesses, especially in knowledge-based industries like accounting, it is still a smart move to provide such coverage. Companies are encouraged to protect themselves from costly litigation somehow simply because people live in an increasingly complex society.
Professional compensation will save your day and ultimately your business from certain ruin.
If you still have doubts about buying it for you and your business, continue reading and understand why it is necessary in many ways. Few companies have escaped legal action from their employees, customers and partners, and the government. With professional compensation, your business can largely avoid two things associated with every lawsuit: exorbitant legal costs for attorneys and monetary compensation for plaintiffs. Keep in mind that in a recession, every penny counts. So if you are in an industry where litigation is too common, your best bet is to get a good professional indemnity insurance policy to protect your bottom line. When things go slower than usual, you save your business for another day. If the plaintiff wrongfully accuses you, your insurance company will also pay for the costs of hiring an expert defense team. You are more likely to refute the allegations and therefore protect your reputation in the industry.
Suppose you and the plaintiff decide to fix the problem without the long, slow, and expensive process of going to court. You will still need money to take corrective action to significantly reduce, if not eliminate, the possibility of future lawsuits arising out of or in connection with the resolved issue. It is where professional indemnity insurance Singapore comes into play. The insurance company will cover the corrective action to some extent, as agreed in the policy. In most cases, the coverage is significant, saving your business another cash outflow that can be used for other worthwhile purposes.
Most public and private sector companies will only work with organizations that have pi insurance that meets their standards. If you cannot provide the specified coverage, you will be removed from the list of qualified entities that can bid for projects. The coverage also benefits the vested interests of companies offering projects for bidding, which explains this prerequisite.
If you have the right coverage, you can easily apply for these projects. A cost-benefit analysis will show that the amount paid for the insurance will be a small fraction of the potential revenue generated by the projects in which your company is involved. Your professional indemnity insurance decision today will save your day and your business tomorrow.