Professional indemnity insurance (or ‘RC Pro’) protects you during the course your professional activity against claims by third parties who have been affected by errors or omissions in the course of your business activity.
Many professions regulated in Luxembourg are obliged in law to take out RC Pro.
These include the following professions:
- estate agents
- lawyers
- notaries
- chartered accountants
- company auditors
- architects and engineers
- medical professions.
You should seek advice from a qualified expert or from government bodies to establish whether the professional activity you wish to pursue is subject to the obligation to take out this type of insurance.
However, even if your occupation is not subject to a legal obligation to take out professional liability insurance, it is still advisable to take out such cover, even if your business is purely intellectual (e.g. consulting or providing advice).
You should not confuse ‘RC Pro’ with ‘Legal Protection Insurance’.
RC Pro is designed to cover losses caused to third parties during the course of your business. It will cover the expense involved in compensating for the loss, in particular the costs of defence.
Legal Protection Insurance covers the cost of your defence in the event of a dispute with a third party. It will provide you with legal advice and cover any legal fees you may incur. It will not cover financial compensation for losses suffered by the injured third party or parties.
For some professions, such insurance is essential if you are to carry on your business. In all cases, by taking out this type of insurance you are protected in the event of loss or damage caused to a third party during the course of your professional activity. This protection is essential to avoid disastrous financial consequences in the event of a dispute, which may sometimes jeopardise your business.
Your choice of professional indemnity insurance (or ‘RCO’) will depend on your professional practice and the risks you run. Whether you are an accountant or an osteopath, the risks are not the same. It is therefore important to:
- choose an insurance policy which covers the risks specific to your profession;
- check the levels of cover offered;
- check the exclusions from cover.
In summary, professional indemnity insurance is essential protection for all self-employed people in Luxembourg. Don't hesitate to contact us to find out which professional indemnity insurance and cover is best for you.
Contact one of our agents to find out which solution is best for you.