Professional indemnity insurance
What is it?
Professional indemnity insurance is an insurance service created to protect business customers from potential financial loss against third parties in the event of a damage to their property, health or life due to the performance of their professional activities.
Who is this insurance for?
Professional indemnity insurance is made for all companies performing manufacturing, services provision, trade and other commercial activities or persons having business licenses and performing commercial activities which are generally more risky and can cause losses to third parties.
Who is insured?
The insurance object is the civil liability of the insured, his employees (insured) against the client (client, patient) and third parties for damage during the term of validity of the insurance contract and in the territory caused by failure to perform or improper performance of his professional activities during the term of validity of the insurance contract.
Professions which are obliged to be insured in Lithuania:
- Property valuers;
- Insurance brokers;
- Bankruptcy administrators;
- Researchers and clients of biomedical research;
- Health care professionals;
- Customs agents;
- Technical supervisors of the construction of the building;
- Travel organizers;
- Designers of the building and contractors.
The list of professions which are obliged to be insured does not cover all financially risky professions such as financiers, accountants, IT service providers, financial and business consultants, translators, public relations consultants, engineers, etc., so insurance companies provide professional liability insurance for these professions on a voluntary basis.
Advantages of insurance:
- The whole business activity and liability arising from all the services provided can be insured. (For example if you provide bankruptcy administration and accounting services, both activities are covered.)
- May include obligatory professional indemnity insurance in accordance with the obligatory insurance coverage provided by laws of the Republic of Lithuania (lawyers, bankruptcy administrators, auditors)
- The entire company’s activities are subject to insurance, not only in Lithuania but worldwide (except the USA and Canada).
- Legal defense costs are compensated.
- Top quality services in case of damage: up to 90% of claims are settled before the court, thus helping to maintain the company’s reputation.