As a self-employed counsellor, you need counselling insurance to protect your business against unexpected losses. You may also be required to have it either legally or contractually.
There are a number of different types of insurance that cover a number of different types of risk. These include insurance that covers:
- Your property
- Your income
- Compensation claims made against you
- Legal costs if you become involved in legal action
If you’re operating from your own premises, you’ll need insurance to protect you in the event of losses due to accidental damage or theft. If you own the property that you’re operating from this is even more important and may well be a condition of any mortgage that you have on the property.
Even if you provide counselling services at your clients’ premises, property insurance is important because it can be surprising to see just how much your business property is worth once you’ve totalled up its value. If you’re operating at your clients’ premises, it’s also important to check whether your business property is covered when it’s taken away from your own premises.
Income protection insurance
If you’re unable to work because you’ve been injured or are ill, you won’t be able to earn but your bills will still need to be paid. You need personal accident and sickness insurance to protect your income if you find yourself in this situation.
It pays a weekly benefit if you’re temporarily incapacitated and a lump sum if you’re permanently incapacitated. The lump sum is also payable if you die or in the event of certain injuries such as the loss of an eye or a limb.
Insurance against compensation claims
No matter how careful you are, some accidents will inevitably occur and when accidents happen, there’s a possibility that someone will make a compensation claim against you. You need liability insurance protects you against this.
This type of insurance covers any compensation awarded against you. It also covers any associated costs and expenses. Your liability insurer will defend any claim made against you, so you won’t need to worry about dealing with complicated legal issues, and the legal fees incurred in the defence of the claim are covered.
Employer’s liability insurance protects you if the claim against you is made by one of your employees. You’re legally required to have this type of liability insurance if you employ anyone, even if you only employ people on a temporary or casual basis.
Public liability insurance protects you if the claim against you is made by a third party. Products liability insurance is similar, but rather than covering compensation claims arising out of something that you have done or failed to do, it covers compensation claims arising due to a defect in a product that you have sold or supplied. Public and products liability insurance are not legally required but you may be contractually required to have these types of insurance. You may also need to have these types of insurance as a condition of your membership of a professional body.
One problem with public liability insurance for counsellors is the fact that it excludes compensation claims which arise as a result of professional activities. You need medical malpractice insurance to address this potential cover gap.
The other problem is that public liability insurance only covers compensation claims which involve injuries or property damage. Purely economic losses are not covered so you need a financial loss cover extension to make sure you are fully covered.
Legal expenses insurance
If you become involved in legal action it can be expensive because the legal fees can quickly mount up. You need legal expense insurance to protect you if you find yourself in this situation. Legal expenses covers your legal costs and your legal expenses insurer will also help you deal with the legal action.