Professional Indemnity Insurance and IT-related Industry Transformations

by Miles Wiseman on Thursday 30 January 2014, 5:12 PM | Category: Insurance & Risk Management| View: 1257 views
 
 
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The rate at which severe lawsuits brought against professional service providers continues to rise especially in the recent years, fuelled by several clients and customers who believe they have suffered in one way or another when professional services failed to live up to their expectations. When such events occur, professional indemnity insurance (PII), also known as professional liability insurance (PLI) plays a key role in meeting some contractual obligations and industry-specific regulatory requirements, or for reputation, financial obligation and customer protection. It covers professionals for any claims their clients bring against them for suffering economic losses after relying on the advices and services provided. 

These professionals need financial protection to meet any damages or the cost of defending legal actions payable. All professionals possessing the right expertise in their relevant fields are more likely to disagree with some of their clients, who may end up accusing them of providing substandard services, negligence, or withholding information. Therefore, they should take the necessary steps to ensure they protect themselves against such eventualities.

Insurance Industry Transformation

Insurance firms have long aspired to the one goal of becoming truly customer-focused, unlike the traditional policy/product focus. It is only until recently that many organizations started realizing that they can achieve that dream, thanks to enabling technologies. In the insurance industry today, it is a different story as the insurers have moved from the over-cautious tech laggards of the past, to taking the lead in exploring some of the innovative and technology-driven ways to interact with policyholders. They customize their offerings and channels to suit both their customers and distributors, and transform customer experience. But, the battle is still on as insurers of all sizes regardless of line of business have to deal with an ever increasing tech-savvy customer base demanding control, transparency, and convenience in all financial services transactions they are involved with. 

There is a wealth of new opportunities available to insurance organizations if they want to build new customer relationships that will be more profitable and professional indemnity insurance will back them to take up new and complex risks and challenges. Apparently, institutions able to adopt new digital-based platforms of customer interaction, design, develop and implement secure and frictionless transaction models will definitely grow and succeed. Therefore, the winning insurer of the future is one that will be digital but personal, multi-channel but customer-centric, innovative yet risk management-committed. 

Insurance Cover for IT Professionals

PII covers even IT professionals for actual or alleged error, substantial omission, act, or conduct in offering IT-related services, work, advice, or specifications. Moreover, it also covers technology products or technology-related products where the IT professional provided IT services. However, significant cultural and organizational changes at insurance companies are required to get a measurable and sustainable return on investment on such activities. As a result, insurance technology and the relevant line-of-business executives must do something to help lead their respective organizations to heights of success in today's fast-moving business environment where business intelligence, privacy, and speed are key competitive differentiators. Without proper strategies and superior technologies that form the foundation of this transformation, an insurance company will lose business to its competitors.

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