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Types of liability - Tort

If you do not have a contractual relationship with your client and he/she becomes legally injured then they may well claim compensation from you under tort law. Torts cover intentional and accidental acts.

Tort of negligence

This depends on the type of breach of ‘duty of care' you are responsible for. You may have a legal obligation to adhere to a reasonable standard of care while performing any acts that could cause foreseeable harm your clients.

In order for your client to win a negligence lawsuit claim, they will have to prove that you owed them a duty of care, that there was a breach of that duty, and that it was such breach that caused the injury, damage or financial loss.

On its website, legal advice firm YouClaim gives a good example of the legal dangers that can be encountered by professionals. It describes an incident involving a 32 year old West Midlands woman who awoke approximately 15 minutes into her operation. The 32 year old was unable to move her limbs or speak during the operation and now suffers from severe depression and has developed a fear of hospitals as a result of medical negligence. She received £28,900 in compensation after taking legal action against the hospital concerned.

Needless to say, negligent incidents such as these make professional indemnity insurance important for the medical sector, as well as for many other professionals.

Tort of defamation

Due to the nature of your profession, it is possible that at some point in your career certain clients may claim that you have made defamatory comments about them. This is particularly important if you work in the publishing, marketing or media industries where your comments are generally more open to scrutiny.

You can be sued for defamation for both defamatory written and spoken comments because if these comments are incorrect they are likely to cause your client financial loss and wrongly damage their professional reputation.

Considering that defamation rewards can be as high as £25,000, this is an extremely important aspect of professional indemnity insurance.

Other examples of Torts include:

• Intentional – Assault, Battery, False Imprisonment
• Property – Trespass
• Economic – Fraud, Conspiracy
• Dignitary – Invasion of Privacy