Top reasons for professional indemnity claims

When you’re in the business of providing professional advice, sometimes, things don’t go according to plan. Whether it’s a small oversight on your part, misplacing a document or making a mistake – there are many instances that can lead to a client taking legal action against you.

You might hold Professional Indemnity insurance to cover such claims, but it is also worth understanding some of the different events that can give rise to these types of claims for a well-rounded approach to managing your risk.

Negligence: Professional Indemnity claims can arise specifically from negligence. This means as a professional you have breached your duty of care in some aspect of your work which has resulted in incorrect or misleading advice being provided. Examples might include making an incorrect calculation, or failing to examine a client’s history thoroughly.

Loss of Documentation: Sometimes professional negligence claims can arise as a result of you misplacing or losing documentation. This can also include filing documents under the wrong client name leading to a claim for compensation. Misplacing documents can not only impact your professional advice or service but may also lead to a privacy breach if you lose confidential documents, or leave them in a public place.

It’s easy to think that this is not applicable given the digital world we operate in today, but it also applies in digital settings – all it takes is accidentally deleting an email; saving a document in the wrong folder, or sending an email to the wrong client.

Misleading information: This can occur where you provide information professional advice to a client that is incorrectly interpreted and the client makes a decision based on your professional advice that ends up costing them financially. This can also be a risk if your business advertises its professional services on any external platforms.

Incorrect advice: Incorrect professional advice can be provided either as a result of negligence, or can result from an honest mistake from your part. If you provide incorrect professional advice to a client, and your client suffers a loss, your client may have a right to take legal action against you.

Intellectual property infringement: While this is by no means a new phenomena, it is even more of a prominent risk in today’s digital age. Intellectual Property infringements can take the form of violation of IP rights, copyrights patents, trademarks, industrial designs, and trade secrets.

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Professional Indemnity Insurance

It’s also important to note that many PI claims can occur due to a combination of the above factors, not necessarily a single reason. Reasons for PI claims can also vary based on your industry or profession. Therefore, when it comes to selecting your Professional Indemnity Insurance provider, it’s worth choosing a broker that has a detailed understanding of your industry.

By arranging your PI Insurance through a broker, you can be confident that if you need to make a claim, you’ll have the support through the claims process. – Aon

For more information, please visit

aon.aom.au/reiv

Please note: The information contained in this article is general in nature and should not be relied on as advice (personal or otherwise) because your personal needs, objectives and financial situation have not been considered. Before deciding whether a particular product is right for you, please consider your personal circumstances, as well as the relevant Product Disclosure Statement (if applicable) and full policy terms and conditions available from Aon on request. All representations on this website in relation to the insurance products we arrange are subject to the full terms and conditions of the relevant policy. Aon has taken care in the production of this document and the information contained in it has been obtained from sources that Aon believes to be reliable. Aon does not make any representation as to the accuracy of the information received from third parties and is unable to accept liability for any loss incurred by anyone who relies on it. The recipient of this document is responsible for their use of it.