Why do Xmas Lists & Socks Never Include Insurance Policies?
Because they don’t bring Comfort & Joy……unless you need a lawyer and are insured for legal costs and damages.
Both Commercial Legal Expenses and Professional Indemnity insurance are the focus of attention in this article.
Failing to prepare for potential disputes that can become ‘legal disputes’ is very risky.
Both these types of cover offer essential protection against legal costs and damages.
But why are they different?
If you have Professional Indemnity insurance, you are protecting your business against allegations of negligence from fee-paying customers in the performance and supply of your professional services and end products. Put another way allegations of sub-standard work.
Often these allegations are unfounded and are successfully defended although there are occasions when legal defence costs must still be paid.
On occasion, allegations are not successfully defended and legal costs plus damages must be paid.
It is the province of Professional Indemnity insurance to meet legal costs defending the photographer and ultimately pay damages if allegations are proven to be valid.
Commercial Legal Expenses
We should anticipate that in 2023 it will be tougher to get business and tougher to get paid properly and on time plus we might expect customers to be even more demanding and on occasion difficult.
Making sure your contracts are as clear, fair, and watertight as possible and that the customer is clearly made aware of the terms and conditions in writing is an extremely diligent thing to do.
This is especially true when it comes to agreed scope of work allowing for circumstances out of the photographers control, terms of payment and copyright.
Contract terms and conditions establish boundaries not only of what the customer can reasonably expect but also what the photographer and videographer can reasonably expect of the customer. Each party to the contract should have responsibilities.
Pursuing customers in contract disputes or recovery of debts (where there is no allegation of Professional Negligence to defend) are two essential components of this protection.
When there is an accompanying allegation of professional negligence to defend the two covers and insurers will need to decide which cover takes precedence as there can be overlaps in cover.
On top of the Contract Dispute and Debt Recovery sections of cover there are other useful sections to include for instance Tax Investigation Costs. It is anticipated that the government will be gearing up to investigate and recover more taxes than usual in 2023.
Commercial Legal Expenses policies often come with free legal advice and templated document services. Well worth a look. You may well be entitled to assistance formulating terms and conditions, along with other peripheral guidance.