Why do project managers need insurance?
Project delays
As the leader of a project management business, you set the standards for stellar timescale management and keep an eye on direction – whether you specialise in IT or interior design projects. When you do this across multiple projects at once, it might be easier than you think for your usual grip to slip. An administrative problem could mean a key product development stage is missed, leading your client to miss out on a timely completion. If they begin legal proceedings for compensation, professional indemnity insurance can help set things right.
An accident at work
Running a busy project management firm is lively business – your breakout rooms are stacked with colour-coded notes, but this atmosphere helps you to keep a laser eye on the details of each project. When a project assistant trips on a stray file, however, they fall into your coffee machine, sustaining injuries. The staff member needs time off to recover and, in this time, you receive a legal letter. Fortunately, your employers’ liability insurance is there to help cover related costs.
A hacking event
Some project managers like to use the latest software for everything they do, while others prefer Excel. Either way, the digital side to project management carries its own set of risks – and insurance can help to offset them. When the platform you use to track progress and align multiple task streams is hacked, your entire operation could be at risk. When cyber and data insurance is built into your project management policy, there’s help with forensics, data recovery.
What insurance is available for project management?
Professional indemnity insurance
Your project management business could find professional indemnity insurance saves the day against several types of customer complaint. It might be a claim that you didn’t meet a contracted deadline, or a complaint of negligence if your client believes a project management error impacted their revenue. When you process information about your clients and their work every day, the possibility of breaching confidentiality can also create risk. Professional indemnity insurance helps to support your business with the cost of the legal process and can assist with paying potential compensation orders.
Employers’ liability insurance
As soon as your project management business takes on its first member of staff, even if they’re part-time or employed casually, employers’ liability insurance could be legally required (external link). This product shields your business against the financial impact of instances of work-related injury or illness. It might be a simple slip-up, or a vision problem caused by years working in improper lighting. Claims may be unpredictable, so it’s good to know employers’ liability insurance can help pay legal fees even if you’re in the right.
Public liability insurance
For project managers, public liability insurance can prove useful against risks to people outside your business. Every firm, no matter how small, has a responsibility to keep people safe and anyone can bring a claim against your business. If a member of the public is injured, or their property damaged, and your company is implicated in this, you could find yourself in court. Public liability from Hiscox can support you with cover whether you work in your own office or a coworking space.
You might also include additional covers in your policy such as portable equipment insurance – useful for client meetings – plus legal protection or cyber and data insurance.
We can provide other types of cover for project managers and add them to an insurance policy tailored to your business.
Get your quoteInsurance for project managers: FAQs
What insurance does a project manager need?
A project manager might need a range of business insurance types, including liability insurance to help manage your responsibilities to people and property. If you work closely with third parties – perhaps by inviting clients into your office – then public liability might be a good fit. Employers’ liability insurance may also be a legal requirement for project management businesses with staff.
Professional indemnity insurance can safeguard project managers against client claims – so you might need this if you’d otherwise struggle to meet compensation demands.
If you’re a self-employed project manager, then you might decide to add portable equipment insurance for extra reassurance.
How much professional indemnity insurance does a project manager need?
A project manager might need varying amounts of professional indemnity insurance – how much you could need depends on factors such as the size and value of the projects you run.
Anyone who is responsible for delivering services or giving advice can face claims for compensation, but the size of these claims hinge upon the severity of the allegation. You’ll set a limit of cover when you purchase insurance – to get the amount right, it might be useful to think about what a worst-case scenario problem might cost your clients.
Explore how much professional indemnity insurance you might need further with our FAQ guide.
How can I insure my project management office?
When your project management business operates from an office, there are certain additional risks that might be worth considering. What happens if a robbery leaves you without key computer equipment, or if a flood damages meeting room furniture?
Our office insurance brings together several property covers, including contents insurance and commercial property insurance, which is especially useful if you own your project management office.
Add-ons, such as equipment breakdown cover, can also help you to keep delivering on work even if the unexpected should strike.
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