By Law, professionals are required to perform the services for which they were hired in accordance with the appropriate standards of contract. The first duty may be primarily contractual, the second arises from the principles of tort law. If a professional fails to perform his contractual obligations towards his client and his client suffers owing to the professional's incompetence or lack of interest in the contractual agreement, then the client is entitled to be restored to the position he would have attained if the contract had been performed as promised.

In brief, professional liability is the failure to use the degree of skill expected of a person in a particular field. This liability, arising out of provision of professional services for others can be covered through professional indemnity insurance. Professional Indemnity insurance is necessary for all actively practicing professionals in each and every industrial or social field.

It offers customised policies for

• General physicians, pathologists, oncologists and medical establishments.
• Interior decorators, engineers and architects.
• Accountants, consultants and lawyers.

Risks covered:

For physicians and medical establishments, the policy covers all legal liability claims arising out of bodily injury and/or death of any patient caused by error, omission or negligence in professional services rendered by the insured or qualified assistants employed by the insured and whose names are declared under the policy.

For interior decorators, engineers and architects, the policy provides cover against risks of material damage, construction damage and death or bodily injury, which may be attributed to a negligent act, error or omission.

For accountants, consultants and lawyers, the policy provides cover against legal liability incurred by the insured by way of losses to clients arising out of acts of errors, negligence or omission on his part or on part of his paid employees named in the policy.

Compensation Offered:

This policy promises to pay all sums (subject to indemnity) which the insured becomes legally liable to pay as damages to their customer in respect of errors and/or omissions while rendering professional services arising out of claims first made in writing against the insured during the policy period. The indemnity also includes the legal costs and expenses besides the compensation claim. Yet, the legal costs and expenses incurred are subject to prior consent of the insured and the limit of indemnity.

Exclusions:

Under the Professional Indemnity Insurance Policy for Doctors and Medical Practitioners, the insurance company is not liable in respect of

• Any criminal act or any act committed in violation of any law or ordinance.
• Services rendered while under the influence of intoxicants or narcotics.
• The performance of general anaesthesia or any procedure carried out under general anaesthesia by dentists and dental surgeons, unless performed in a Hospital.
• The use of drugs in weight reduction.
• Claims made against the Insured arising from the performance of cosmetic plastic surgery, hair transplants, punch grafts, flap rotations, etc.
• Any third party public liability.
• Claims arising from any condition directly or indirectly caused by or associated with Human T-Cell Lymphotrophic Virus Type III (HTLV III) or Lymphadenopathy Associated Virus (LAV) or the mutant derivatives or variation thereof or in any way related to Acquired Immune Deficiency Syndrome or any similar syndrome.

The policy also does not cover liability

• Assumed by the Insured by agreement.
• Arising out of willful or intentional non-compliance of any statutory provision.
• Arising out of loss of purely financial nature like loss of goodwill, loss of market, etc.
• Arising out of fines, penalties, punitive or exemplary damages.
• Arising out of war and nuclear risks.
• Arising out of genetic injuries caused by X-ray treatment/ diagnosis or treatment/ diagnosis with radioactive substances.

Under professional indemnity insurance for architects, engineers and interior decorators, this policy does not cover against any claim made in respect of

• All personal injuries such as libel, slander, false arrest, wrongful eviction, wrongful detention, defamation, etc and mental injury, anguish or shock resulting there from.
• Infringement of plans, copyrights, patents, trade name, trade mark or registered design.
• Any dishonest, fraudulent, criminal or malicious act or omission.
• Liabilities assumed by the insured by agreement and which would not have attached but for the agreement.
• Loss of any documents, data, information or losses sustained on account of time spent in investigating the cause of damage, including costs for re-projecting in connection with the damage.
• Injury to any person under the contract of employment or apprenticeship with the insured, their contractors and/ or sub-contractors, when such injury arises out of the execution of such contract.
• The ownership, maintenance, use, occupation, leasing or custody of property, mobile or immobile, by, to or on behalf of the insured, or brought about by damage to or destruction of property owned by, rented or leased to or in custody of the insured.
• Deliberate, willful or intentional non- compliance of any statutory provision.
• Fines, penalties, punitive or exemplary damages or any other damages resulting from the multiplication of compensatory damages.
• Loss or damage arising from natural perils like flood, earthquake etc. and war and nuclear risks.
• The non-compliance with technical standards commonly observed in professional practice, laid down by law, or regulated by official bodies.
• Loss of use and/ or loss due to delay.
• Arising from exceeding higher estimates and costs from adhering to deadlines in completing the construction of project or part thereof and from defective accounts or control of accounts.
• Inadequate quantities/qualities or arranging or handling the supply of material.
• Activities of the insured as joint venturer or as partner unless such joint venture or partnership is described in the policy, the liability of the company being limited to the extent of participation/ share in the business so named.
• Any contract where the insured acts as a construction contractor, whether or not in conjunction with his/ their profession as stated in the policy.
• Liabilities arising out of pollution and/or contamination, whatsoever nature.
• Claims for losses as a consequence of material or construction damage, such as, loss of production of all kinds, loss for inferior performance, poor quality or lower profitability and additional futile expenditure of the principal to reach normal performance, quality or profitability.
• Claims for damage caused by motor vehicles, sea vessels or aircraft.

Under professional indemnity insurance for accountants, lawyers and consultants, this Policy shall not indemnify the Insured for any claim made

• Arising out of all personal injuries such as libel, slander, false arrest, wrongful eviction, wrongful detention, defamation, etc. and mental injury, anguish or shock resulting there from.
• Infringement of patents and copyrights.
• Any dishonest, fraudulent, criminal or malicious act or omission.
• Liabilities assumed by the insured by agreement and which would not have attached in the absence of such agreement.
• Loss of any document /data/ information, losses sustained on account of time spent in investigation of cause of damage and claims for such losses sustained.
• Bodily injury, sickness, disease, death, damage to property or financial loss and/ or consequential loss unless arising out of wrongful, faulty or inadequate advice.
• Deliberate, willful, or intentional non-compliance of any statutory provision.
• Fines, penalties, punitive or exemplary damages or any other damages resulting from the multiplication of compensatory damages.
• Any losses arising out of war and nuclear risks.
• The non-compliance with technical standards commonly observed in professional practice, laid down by law or regulated by official bodies.
• Loss of use or loss due to delay.