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Professional indemnity insurance is a type of cover that protects reputed and reliable insurance companies in UAE against financial claims from clients and other third parties resulting from any of the following reasons:

• Unintentional Breach of Professional Duty

• Professional Negligence

• Errors and Omissions

• Poor Advice 

• Libel and Slander

• Infringement of Intellectual Property Rights

• Loss of Documents

• Unintentional Breach of Contract 

Professional indemnity insurance covers the costs of any monetary damages awarded by a court of law as well as any associated legal defense expenses up to the policy's maximum. The coverage can be offered for a specific project or on an annual, renewable basis. 

Risks in the Absence of Professional Indemnity Insurance

You should expect the worst while running a business, as it is on the edge of risk. Yea, we are talking about the possibilities for the future. Without professional indemnity insurance, running your firm simply opened it to third-party claims and liabilities resulting from omissions and unexpected errors.

Legal Dangers

Professional indemnity insurance easily shields you from civil liabilities such as contract, tort, and duty breach if you are in a professional industry. You can set up your insurance policy with reliable insurance companies in Dubai and the UAE to cover as many civil liability areas as needed. 

I) Tort Liabilities

• In the event that you and your client do not have a contract but they have a chance for the legal case, there is a chance for them to move it under tort law.

• Professionals must practice caution when performing their tasks, and the UAE Federal Law No. 5 of 1985 holds them accountable for willful misconduct and fraud. It can be argued that the behavior qualifies as gross negligence if it goes beyond what a prudent person in the same field of employment would do.

• To prove negligence, the following things must be shown according to DIFC tort laws:

• Party at fault owed a duty of care to the party in loss suffering.

• The responsible party at fault failed to uphold the duty of care.

• Damage resulted from the duty violation (causation).

II) Breach of Statutory Obligations

For professions like auditors, VAT consultants, and lawyers, professional indemnity insurance is crucial to renewing and maintaining a trade license.

III) Breach of Duties

• You will be covered by professional indemnity insurance in cases of breach of fiduciary duty, intellectual property, and statutory duty.

• Coverage for statutory duty breaches becomes important if you are working in the construction, real estate, accounting, or architectural industries, among others.

• Media rights, patents, copyright, plagiarism, and trademarks are all instances of intellectual property that can be in breach. Fiduciary duty is a legal arrangement between your company and your clients that is based on strong trust and confidence. When your client emphasizes that you are not running in their best interests, you are typically in breach of fiduciary duty. 

Many of the professional indemnity insurance policies from the best insurance companies in UAE hold these as their basic components, but add-ons can also be considered. Some of the possible add-ons are libel/slander, fidelity, and coverage for document loss. People are more conscious about finding the best insurance companies in Dubai and the UAE to depend on with 100% reliability. 

Financial Hazard

Hope you are well aware that running a business without holding professional indemnity insurance is equal to exposing yourself to heavy financial risk. It can be expected, like third-party claims and liabilities. Do you know? A claim can simply cost hundreds of thousands or even millions of dollars. Do you want to jump into the pit of risks? Think about it now!

The majority of insurance companies in UAE have plans that offer coverage with indemnity limits ranging from AED 500,000 to AED 10,000,000. Your clients may even request that you carry considerably greater limits, such as USD 50,000,000, which is also not uncommon. 

Many popular insurance companies in Dubai and the UAE offer different kinds of policies. Don’t worry! We know that since running your business is your main duty and most dedicated thing in life, these terms, numbers, and words may be hard and a headache for you to comprehend.

So, trust the professionals at policyhouse.com for your business-related insurance needs, as we are recognized as one of the most reliable insurance companies in UAE. We are ready to support you in understanding all there is to know about shielding your firm against legal liabilities brought on by omissions or negligent errors.

If you are looking for an insurance broker in Dubai or any other emirate, we are here to assist you. If you need more valuable details, you can talk with our insurance experts and apply for the most suitable one.