Counsellors need counselling insurance to protect them against the risks that they face just like every other business does. There are a number of different types of insurance that counsellors should have, and they are usually bought as a package insurance policy rather than bought individually.
The most important type of insurance that a counsellor should have is liability insurance. In fact, if you employ anyone, liability insurance is a legal requirement and you can face a heavy fine if you don’t have it.
Counsellors also need insurance to protect their business property, insurance to protect their income if they are unable to work and insurance to protect them in the event that they are involved in legal action.
Compensation claims can be expensive to settle. If someone is seriously injured, the compensation award can exceed £250,000.
Liability insurance covers these compensation awards. It also covers any associated costs and expenses, such as the claimant’s loss of income. Your liability insurer will defend any claims made against you, and will cover any legal costs incurred in the defence.
You need employer’s liability insurance if you employ anyone, even if you only employ them on a temporary or casual basis. This type of liability insurance covers claims made against you by your employees and it is required by law.
You also need public liability insurance to protect you against compensation claims made against you by third parties. This type of liability insurance is not required by law but it may be a contractual requirement or you may need it as a condition of your membership of a professional body.
Public liability insurance doesn’t cover compensation claims that arise as a result of professional activities. This means that you need to ensure you have malpractice insurance as well, to make sure you’re not uninsured in the event of a claim.
The other limitation with public liability insurance is that it only covers compensation claims involving property damage or injuries. Compensation claims for purely economic losses are not covered so you need to make sure your public liability insurance has a financial loss cover extension so you are fully protected.
Property insurance protects your business property against accidental damage or losses due to theft. Even if you don’t have your own premises and provide counselling services at your clients’ homes or places of work, you should still make sure that you have this type of insurance to protect you.
You should ensure that you’re covered for the full value of your property because you could be penalised if you are underinsured in the event of a claim. If you provide counselling services at your clients’ premises, you should also check whether your property is covered at those locations.
Personal accident & sickness insurance
If you are unable to work because you’re ill or you’ve been injured, personal accident and sickness insurance protects you so you’re still able to cover your monthly outgoings.
This type of insurance pays a weekly sum while you’re temporarily incapacitated or a lump sum if your incapacitation will be permanent. The lump sum is also payable if you die or in the event of certain specified injuries, such as the loss of an eye or the loss of a limb.
Legal expenses insurance
If you become involved in legal action, it can be expensive. You can become involved in legal action for a number of reasons, including:
- Employment tribunals
- Disputes with neighbours or clients
- Tax/VAT inspections
- Criminal charges being brought against you
Legal expenses insurance covers the legal costs that are incurred in dealing with such legal action. In addition, your legal expenses insurer will help you deal with the legal action to ensure the best possible outcome.