27/09/2018
Tailored insurance for design agencies
By Bluefin Professions and DBA
Does one creative idea fit all? We all know the answer to this. The same principle applies to insurance. The type of protection you take out should be tailored to suit both your business and your clients. This also serves to reassure clients that you can manage unforeseen disasters effectively with insurance that is specifically designed for your respective needs.
It’s not unusual that your clients will ask for Professional Indemnity insurance to be in place as part of their contractual stipulations, but there is often a lack of awareness for the actual risks facing design businesses when it comes to potential negligence claims. Bluefin Professions is the DBA’s recommended insurance broker for Professional Indemnity and business insurance.
What is Professional Indemnity?
Having insurances in place is all about managing risk – both for your own business and your clients. On a simple level we can all understand the benefits of a product such as office contents insurance – especially if we have fallen victim of burglary or disaster such as a fire. Products such as Professional Indemnity insurance, as well as protecting you and your business, are also about reassuring clients. Buying design services can be difficult enough so a client is often looking for every opportunity to mitigate their risk. Knowing an agency is well covered for professional indemnity can help a client make that final leap of trust with a new agency.
Going back to basics, Professional Indemnity, or PI, insurance is there to cover you should you be sued for professional negligence. This could arise by complaint following delivery of a project or a demand for compensation should your client be unhappy with the work undertaken.
PI therefore provides cover for the legal costs and expenses in defending claims for alleged professional negligence, and also the compensation that may be due to your customer if it’s proven that you were at fault for a loss through the provision of inadequate advice, services or designs.
The design industry has unique insurance requirements when it comes to PI, and that’s why we’ve teamed up with Bluefin Professions to develop a product that meets the needs of member businesses.
So, is Professional Indemnity insurance compulsory?
Although not compulsory for DBA members, it’s highly recommended you have PI insurance in place. This is important for the following reasons:
– Client expectations – There is a growing trend of businesses only employing the services of a professional who carries adequate professional indemnity cover. Clients want to minimise their exposure to risk as much as possible.
– Financial prudence – Professional Indemnity insurance can protect your business against compensation sought by a client for your alleged failure to carry out a service or for your actual or alleged negligence. More importantly, Professional Indemnity insurance provides the legal costs involved in defending such claims.
– Safeguarding your reputation – No one likes to think that they make mistakes but the reality is that we all do. The fallout from a claim being made against you can also be severely damaging to your reputation. In most cases the sooner a claim is dealt with the better the outcome both financially and to your reputation. Professional Indemnity insurance means you can respond quickly to any allegations made against you.
PI claims case studies – the design industry is not immune to claims
The following claims case studies are real-life examples provided by the DBA’s scheme underwriter, Hiscox. They bring to life how DBA members could be impacted by PI claims when going about their business and, even if there is no fault on their part, shows how having a good insurer in their corner to fight the claim was invaluable during a stressful time.
Website designer
The Claim: A website designer was sued by a customer who was unhappy with a project.
The resolution: We swiftly confirmed cover and instructed our panel solicitors to defend the insured. We were able to negotiate a settlement of the legal proceedings, with the insured’s client agreeing to drop the lawsuit and accepting terms of confidentiality around the settlement.
Creative agency
The Claim: A creative agency worked with their client on a global marketing campaign to launch its new brand. This included placing adverts in print and on billboards. Shortly after the launch an artist contacted the brand, claiming that the adverts were a copy of his works.
The resolution: Almost as soon as the claimant announced himself, he began legal proceedings in France against the client alleging copyright infringement. The creative agency, due to the contract agreed with their client, owed its customer an indemnity to defend such claims. We immediately instructed specialist local lawyers to defend the claim. The French lawyers advised that the claim was a poor one and could be defended. After almost two years of litigation, the court recently dismissed the claim, finding no fault with anything the agency had done.
Graphic Designer
The Claim: A graphic design agency created marketing material for one of its clients. The designer obtained the appropriate licences for photographs used in that material. It subsequently received a complaint from an individual claiming they owned intellectual property rights for one of the images used. The agency’s client demanded significant damages to compensate them for the alleged infringement. The agency’s client was understandably concerned about the allegations.
The resolution: We swiftly confirmed cover in respect of the claim and advised the insured on the merits of the claim. The complainant had problems with establishing that they actually owned the rights asserted and, in any event, the amount of damages sought was highly unreasonable. We drafted correspondence for the agency to send to the complainant rebutting the allegations and were able to negotiate a settlement with payment of a nominal sum to dispose of the claim. The agency’s client was reassured and the agency relieved to resolve the issue.
Insurance for DBA members
We’ve made it easy for members to arrange PI cover with our partners, Bluefin Professions.
They understand that the insurance needs of DBA members are different and will work with you to negotiate a policy that meets the requirements of your contact.
They have developed an insurance scheme that’s underwritten by Hiscox, one of the UK’s leading insurers, with exclusive premium rates and the following benefits:
• Easy application process.
• Free first excess on Professional Indemnity claims.
• Crisis containment cover extension.
• Business HR facility.
• Ability to bespoke cyber cover as part of Bluefin exclusive office cover.
• Interest free instalment facility.
Plus, clients of Bluefin Professions all receive as standard:
• Free tax and legal advice helpline available to all partners.
• Free counselling, health and medical advice helpline available to all staff.
To get a quote for PI, office or cyber liability insurance:
Call: 0345 894 4684
Or visit: https://www.bluefinprofessions.co.uk/dba/
