BAV protection
The professional liability insurance, also called the BAV, is essential insurance for all advisory professions, from brokers and consultants to lawyers and coaches. In particular, ZZP'ers and other small independents do well to take out a BAV. In this blog, you'll read about the benefits of an IUP and why it is especially good at protecting small businesses.
Risk for self-employed workers and SMEs
A ZZP'er is strong in his or her shoes but at the same time very vulnerable. Because you are your company. You are an expert in your field, so the risk of something happening is small. But anyone can make a mistake, and if that mistake has major financial consequences for your client, he or she will make a claim against you. Small companies (unlike large companies) usually don't have reserves to absorb claims. So they pose a direct threat to the progress of your business. The trend is that there is an increase in the number of legal proceedings, so as a ZZP or SME, you are increasingly at risk when practicing your profession.
Small mistake, big consequences
As an example of such a threat, Anita, office assistant at insurance specialist Cheapp, cites the accountant who had made a mistake in a client's tax return. This client faced an after-tax bill that was recovered from the accountant. Without BAV, this incident would have bankrupted the bookkeeper. Also, the IT specialist who designed a program for a web shop with a small mistake in it, got a claim for lost income. These examples show that a wrong action or faulty advice can quickly have major consequences.
Consulting loss insurance
With a BAV, you are insured against property damage resulting from wrong advice, wrong actions, incorrect or incomplete information or violation of intellectual property rights.
The advantage of the BAV is:
- The claim will be reimbursed
- Less chance of reputational damage
- No threat to the progress of the business
- Business relationship with customer is not disrupted
In addition, good insurance gives your company a professional appearance. Some clients consider a BAV a condition for awarding you the contract. It is therefore advisable to mention this in your quotation. Especially since the General Terms and Conditions do not always offer you sufficient protection.
Professional groups BAV
Professional liability insurance (BAV) should not be confused with business liability insurance. The latter insurance pays out for material damage. The BAV is precisely for companies that do not make things, but give advice. The following professional groups fall under it, for example:
- Advocacy
- Accountancy
- Posting
- Recruitment
- ICT
- Marketing and PR
- Training and coaching
- Architects
- Brokers
- Consulting firms
Directors' liability insurance
So by being a good director, you can't always avoid directors' liability. But fortunately, you can insure yourself for it. Take out a good directors' liability insurance policy. It provides protection against claims and usually covers litigation costs as well. Directors' liability insurance ensures that your private assets will not be called upon in the event of claims for damages resulting from decisions you have made as a director of your organization.
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