What is the meaning of indemnity insurance?
Have you heard the term indemnity insurance tossed around but you've never really known what it was or what it did? If so, we may be able to help as we've put together a brief guide to the meaning of indemnity insurance. Hopefully by the end of it this sometimes confusing term will be crystal clear!
A lot of business professionals and certain professions are asked to take out indemnity insurance. Simply put, it's a type of insurance that protects you from financially crippling and reputation damaging claims by dissatisfied clients for work of services you have rendered. You'll find that most big companies will take out an extensive indemnity insurance policy on the off chance that they have been proved to have been negligent on some issue.
Some areas that people take out indemnity insurance to protect include: negligence or breach of duty of care, the unintentional infringing of another person's copyright, trademarks or broadcasting rights, the loss or damage of sensitive documents owned by your clients, and liability arising from the theft of your client's money.
No two businesses are the same, so indemnity policies are often tailored specifically on a case by case basis. A good policy should give you access to staff with an expert understanding of indemnity cover, access to specialist indemnity insurance legal teams, and avoiding large legal costs your company could be on the hook for.
Basically, if you are starting up a business, you should consider taking out an indemnity insurance policy.