Professional liability insurance: what are the advantages and disadvantages

The professional liability insurance price is intended to protect employees against professional risks.

The employee benefits from a right guaranteed by the law to a protection against the professional risks. The professional liability insurance represents therefore a guarantee which is contributed to him to protect himself against the unforeseeable consequences of his activity.

The professional liability insurance is established according to the risks incurred by the employee. The higher the risk, the higher the remuneration.

The professional liability insurance covers financial losses due to an accident at work or a professional fault. It can also help the employee who is a victim of rape or kidnapping.

Professional liability insurance is mandatory for all employers who employ a natural person.

Professional liability insurance: what are the advantages and disadvantages?

Professional liability insurance (PLI) is insurance for employers. It covers damage to property and persons caused by accidents in the workplace. These damages can be caused by acts or omissions of the employee, but also by faults of the employer. There are many advantages of PIPs for employers. First, they avoid a possible breach of the employment contract. Secondly, they offer financial protection to the employee in the event that a third party takes over the company's expenses. Finally, they allow the employee to deal with a condemnable fault without having to file a civil suit. There are also many disadvantages to employers. First, the compensation paid by employers can be very large. Second, they can raise suspicions of harassment of the employee. Third, they can result in a poor public image for the company.

What is professional liability?

Professional liability is the obligation of an employer or agent to work responsibly to protect the interests of his or her company. It applies to all types of organizations, private or public.

In order to evaluate the professional responsibility, the following three elements are studied: the fault, the commitment and the risk.

Misconduct refers to the excesses in which one leads others. This is the case, for example, when one neglects to protect important information, or when one is irresponsible towards clients.

Commitment is what one is willing to do for the good of others. If you want to stay working for a company, you must be committed to it. For example, you cannot claim a reason if you leave your job without notice.

Risk is the most risky aspect of our daily lives. It includes the possibility that we get sick, that our business does not go as planned, or that we lose our job.

If you touch a tainted food item, you quickly realize the effect it has on your health. Likewise, if you neglect to take measures to protect your job, you risk being affected financially. As a worker, you have a responsibility to your company.

What is professional liability?

The concept of professional responsibility is essential in modern society. This principle stipulates that every agent in charge of making decisions, whether he is an employee, a manager or a brokerage employee, is aware of his responsibilities. Professional responsibility imposes a moral obligation on those involved to behave honestly, prudently and ethically. It also implies a legal obligation to submit to the rules of confidentiality defined by the Labor Code.

I will conclude by saying that professional liability insurance is an important tool to prevent the financial inconvenience of an accident and is often an effective solution to legal costs. Insurance also provides protection against the risk of termination of employment and loss of wages, and can help restore a company's image and credit.