What is Professional Negligence?

Professional negligence is the failure of a professional to perform their responsibilities to the required standard or care.

Professional Negligence

Professional negligence is the failure of a professional to provide their services in line with the duty of care they owe their client. This is also known as a breach of professional duty. This duty is the requirement for a professional to meet the suitable standard of care and skill in the services provided to their client.

It is most simply understood in the context of bad advice, however a professional's duty of care would extend further to include all services provided. Such as the failure of a structural engineer to identify structural problems in a building project, or a bookkeeper inputting inaccurate figures into a tax return.

Should you fail, or be alleged to have failed, to meet this duty of care as can be expected from a professional in your industry, your client could bring legal action against you in respect of professional negligence.

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Does Professional Indemnity Insurance cover 'professional negligence'?

Professional Indemnity Insurance protects your business against claims of professional negligence, as it is the very purpose of Professional Indemnity cover. The policy will cover defence costs incurred in proceedings, and your legal liability following its conclusion i.e. compensating your client for the financial losses they may have suffered following the negligent act.

Most contracts will include clauses which require that the business indemnifies the client for losses they suffer as a result of errors, omissions, or negligence in the services provided.

You should consider holding a Professional Indemnity Insurance policy to cover such claims if you provide any form of professional advice as part of your services.

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