Professional Indemnity Insurance, what's the point?

[Moscow Mule]

I'm fairly sure my insurance has some exclusion clause especially for when you're working in a system where an error could have an immediate financial impact. I often wonder why I bother paying for it

sounds about right - I think I have to pay extra for "immediate financial impact" if I'm working at a bank/in payments support role.

Don't need it at the moment as I'm looking after mickey mouse developers. Small mercies..

[d000hg]

If you have a Ltd then you can only be sued for what the company has... does that mean you can withdraw all outstanding profits as a dividend?

[EternalOptimist]

I have had cover a few times, but only because the client demanded it. Then you get the insurers phoning you up for the next twenty million years asking you to renew. grrr

[moorfield]

Bought it first time at a pimps insistence.

Second time I "needed" it I just edited the dates on a scanned copy of previous lapsed policy using photoshop and emailed it off to the pimp. That was enough.

Now I'm direct at a clientco they haven't mentioned it at all.

I've always assumed if I c_ck up that badly (I won't) I'll just be marched off site and the permie boss will take the rap.

[centurian]

If you have a Ltd then you can only be sued for what the company has... does that mean you can withdraw all outstanding profits as a dividend?

Exactly.

However, I heard that a director is responsible for acting in the best interests of the company and if they don't - they can be sued personally. Not sure whether this fits.

Whether anyone has ever been done for this is another matter.

[xoggoth]

Only cos agencies require it. The only time I ever felt glad of having it was when I was the only person producing the software and the images it produced were being sold to about 200 clients.

Most of the time on big projects there are so many layers of testing and checking by others that if none of them spotted the fault eiither it had to be so subtle that making it could hardly be called negligent anyway.

[zamzummim]

It's a contractual requirement for the direct contracts I do -
.

Yep - same here!

[swamp]

Some clients and agents require it, but you need to maintain it for many years after, which I expect not many people do.

[mrdonuts]

what about its relevance as a defence against IR35

[s2budd]

It's insurance. You don't expect to have to use it but if the s*it comes your way then your bloody glad that you have it.
The same principle as house insurance. When the gas leak goes pop then it's a small price to pay for peace of mind.