Professionals like doctors and chartered accountants are held in the highest esteem in India. However, in some instances, professionals have to deal with liabilities like a lawsuit, misdiagnosis charges, third party claims, etc. Dealing with these issues requires spending substantial funds that can be managed with professional indemnity insurance. Such a policy ideally covers virtually all liabilities arising from legal complications.
If an individual does not have an insurance policy in place, they can also look for an alternative like a professional loan. This credit option lets individuals manage the whole range of expenses associated with such legal hassles. Nevertheless, professionals pondering over the better financial option to deal with a legal liability must understand professional indemnity insurance and professional loan meaning to make the right decision.
What is a professional indemnity insurance policy?
The professional indemnity insurance policy offers financial coverage against clients or patients’ lawsuits concerning a range of allegations like misconduct, breach of confidentiality, etc. A policy like this provides financial protection against unfair lawsuits or third-party claims. An individual also receives coverage for legal expenses arising from libel or slander charges.
However, availing a policy bounds an individual to yearly premium payment, which strains one’s savings. Thus, one must know how to choose the best professional indemnity insurance policy.
Alternatively, a medical practitioner can opt for professional loans with sizable funds and no end-use restriction.
For instance, professionals can approach NBFCs like Bajaj Finserv that offer a professional loan up to Rs.35 lakh. This credit form requires no collateral or guarantor, making the application and disbursal process convenient and swift. Borrowers can use the fund to address all the costs related to a lawsuit easily.
One can also look for pre-approved offers that make loan applications hassle-free and straightforward. It is levied on products like a personal loan, business loan, etc. Check your pre-approved offers by entering your name and contact number.
Nevertheless, professionals must consider a few vital factors before they commit to an indemnity insurance policy.
Factors to consider before applying for a professional indemnity insurance policy
Individuals requiring protection against the uncertain liabilities must first understand professional indemnity insurance and why doctors should care.
Certain factors that influence the insurance application process are –
1. Sum insured
The first factor that a CA or doctor must consider when availing professional indemnity insurance is the coverage amount. Ideally, the policy must cover the entire scope of legal expenses. Selecting an insurance policy that offers a substantial sum insured is vital.
The next factor that holds weightage when availing an insurance policy is the premium payable. Although professional indemnity insurance policy premiums are sizeable, so is the sum insured. In this regard, it’s crucial to do a cost-coverage analysis to determine whether you are deriving adequate value off the plan.
3. Liability coverage
Another factor to check before applying for a professional indemnity insurance policy is liability coverage. Ideally, it must cover areas like –
- Lawsuit expenses
- Third-party compensation
- Violation of confidentiality
- Libel and slander
- Document loss, etc.
Per the professional loan meaning, borrowers can cover these expenses with such borrowed funds as well.
4. Claim process
The claim process is also a vital factor to consider before selecting an insurance provider. Nowadays, every financial transaction takes place online. Thus, opting for an insurer offering a digitalised claim process would be smarter. Also, check the list of documents that you need to submit to raise a claim.
5. Check flexibility
It’s imperative to check the level of flexibility an insurer offers. Check whether the insurance provider will allow you to increase or reduce the sum insured, modify premiums, etc., yearly or in the middle of the tenor.
Dealing with legal troubles in professions like medical and chartered accountancy can be quite expensive, and an indemnity insurance policy can help. A professional loan can also work as an alternative to mitigate the added expenses. So, choose wisely by researching well on professional loan meaning and indemnity insurance policies.