Search results

Thursday, 9 October 2014


A professional is a person who possesses special skills and is (usually) paid to undertake a specialized set of tasks. A professional offers himself or herself as an expert in a particular area and is expected to exercise the skill and expertise at the level set by the profession. Examples of professionals include doctors, engineers, lawyers, architects, accountants, engineers, scientists, technology experts, social workers, real estate agents, insurance brokers, insurance companies and artists.

However, professionals are human beings who can make mistakes or fail to exercise the required professional skills, expertise and judgement at the level expected by their clients. Because the public relies on the expertise of a professional, even when negligence is not established, they can be sued for mistakes that result in injury, loss or damage to the client. Most other liability insurance policies cover claims of bodily injury and property damage only and typically exclude coverage for claims related to the delivery of professional services. The liability risk associated with your company’s professional errors, omissions and negligence can be far greater than the bodily injury and property damage risks covered by your general liability policy. A professional’s legal liability can only be covered by a Professional Indemnity insurance policy.

If you are in the business of selling your knowledge or skills by providing advice, recommendations or services to your clients, it is important and in your best interest to buy Professional Indemnity (PI) insurance. In Nigeria, many professionals are required by law or as part of their professional authorization to have PI insurance.

1.0. Scope of Cover
Professional Indemnity insurance provides comprehensive protection against claims for financial loss, injury or damage arising from an act, negligence, error or omission in the performance of professional services. The cover also includes payment for any legal fees that accumulate during litigation and the damages that might be awarded against the insured up to the policy’s coverage limit

A Professional Indemnity policy can be arranged to cover the following, amongst others:
1.1. Breach of Professional Duty: Civil liability (including payment of compensation and claimant costs and expenses) arising from a breach of professional duty owed in the conduct of the insured’s professional business.

1.2. Defence Costs: The cost incurred with the prior written consent of the insurer in the investigation, defence or settlement of any claim under the policy.

1.3. Libel and Slander: The insured’s legal liability to pay compensation and claimant’s costs and expenses and other costs in respect of claims made against the insured or any of its employees for libel or slander committed (not committed with express malice) in the course of carrying out its professional business or practice.

1.4. Intellectual Property: Infringement of rights of intellectual property, provided that the act, error or omission by the Insured is unintentional and is committed in the course of rendering professional services.

2.0. Possible Policy Extensions
The Professional Indemnity policy can be extended to cover the following risks subject to the payment of additional premium and other additional terms and conditions.

2.1. Employee’s Liability: Liabilities arising from the act of the insured’s employee (other than for such employees’ dishonest, fraudulent, criminal or malicious breach of duty) for which the insured would have recovered under the policy.

2.2. Loss of Documents: The costs, charges and expenses incurred in replacing or restoring documents (including but not limited to documents which are the property of the insured) which have been destroyed or damaged, or lost or mislaid and cannot be found after diligent search.

2.3. Costs of Official Inquiries: The reasonable costs incurred by the insured in respect of legal representation at any inquiry (including any coronial inquiry or any inquiry under the disciplinary rules of a professional association of which the insured is a member) or other similar process relating to or connected with the insured’s professional business, which the Insured is legally compelled to attend. Sometimes insurers will insist that they nominate the lawyer to represent the insured.

2.4. Compensation for Court Attendance: Payment of compensation (subject to a limit) to the principal or employee who attend court as a witness in connection with a claim recoverable under the policy, The legal advisers of the insured together with the insurer must be in agreement that such witness’s testimony is necessary.

Click on for more on Insurance & You


  1. Thank you Mansard for the educative piece on Punch Newspaper of April 29,2014.

    Would you talk about third party policy, and also give professional advice on which policy is best?

    Thank you,

    Sent from my iPhone

  2. Wonderful piece!