As a management or business consultant, your goal is to improve your clients' prospects, streamline operations and suggest innovations. Of course, it's not possible to predict the future, and sometimes your recommendations don't work out.
If your clients think you've acted in bad faith or misadvised them, they could take legal action. So a consultants' insurance package for small businesses or self-employed professionals is essential to protect your own business when things go wrong.
To secure yourself against legal claims, professional indemnity insurance for consultants is an important consideration. It can help to cover the costs of compensation and legal fees. And even if a court rules in your favour, those fees can be expensive.
Other types of cover are also important to consider including in your policy, such as public liability and business contents.
What kind of insurance does a management consultant need?
As a management consultant, you offer expert advice to clients on topics such as strategy and business planning. But if things go wrong, you can be held responsible, and if there are financial losses, you could be asked to meet them. It could be that you give factually incorrect information, or there are just disagreements over your strategy. Either way, if clients pursue you for compensation, you could be seriously out of pocket.
Professional indemnity insurance for consultants should be your first priority. It can meet the costs of legal action and compensation. Additionally, it's worth including public liability cover in your package, as any third party accidents while you're working could result in claims against you. Also, consider business contents cover for your laptop or other digital equipment you use for business purposes.
Is consultants' insurance expensive?
The price of insurance for consultants will depend on a number of factors. These include the number and types of cover you choose to include in your policy, as well as your annual turnover and location of your business
Your history of insurance claims and the nature of your work can also make a difference.
Does a business consultant need professional indemnity insurance?
Business and management consultant insurance can include a number of different covers. Professional indemnity insurance is not legally required, but it's an important cover to consider, which is why it’s the core cover of the small business insurance packages we arrange for you at Aon.
Professional indemnity cover can protect you in the event of legal action against you. This could be because you gave a client incorrect information or just advice your client considers unsuitable. If it results in financial loss to the client, they may claim compensation from you. Professional indemnity insurance can help protect your business in this situation.
Do I need insurance as a self-employed consultant?
Business insurance for self-employed consultants is an important consideration. As a sole trader, you're not covered by an employer's policies, so any losses or legal actions will fall at your door. There are also risks of accidents to clients in the course of your work, as well as the loss of your equipment. For these threats, including public liability and business contents cover can help keep you secure.
In addition, f you give unsuitable advice, clients could face financial losses, and they may seek compensation from you. Even if their legal action is unsuccessful, you can still face significant costs. Professional indemnity insurance can help cover you for various outcomes.
Do business consultants need public liability insurance?
Business consultants face a range of liabilities in their work. As a consultant, you're exposed to risks if you're deemed to have provided unsuitable advice. Professional indemnity insurance is an important consideration to help cover you for these eventualities. But there are other risks too, and a tailored consultants' insurance package should include a number of covers.
Public liability insurance is important to help cover the risk of clients being injured, as well as losing or damaging their property. If this happens in your office or while you’re carrying out your business activities, you can be held responsible. To help protect your business in these situations, it’s important to think about having the right insurance in place.