Ralph Günther is an insurance expert and founder and managing director of the insurance portal exali.de. In an interview he explains why a professional liability insurance is important for freelancers. Ralph Günther has many years of experience in risk management and the insurance of IT experts, creatives, consultants and lawyers. His focus is on securing financial losses and the further and new development of industry-specific insurance concepts. As one of the pioneers in the online insurance business, he was actively involved in improving insurance protection for freelancers and launched new professional liability services on exali.de. He regularly passes on his knowledge to his target group as an author in relevant specialist media. On his blog “Financial loss: rethinking insurance” http://www.rgblog.de/ he also provides information on current market developments and highlights practical claims. Website: http://www.exali.de
Mr. Günther, why is the issue of employability a topic that independent service providers and freelancers no longer go by?
Freelancers and service providers can no longer avoid professional liability because the risks from globalization and the Word Wide Web have become so complex and even case law lags behind technical progress. And wherever "gray areas" arise, this is exploited - as in the area of legal violations.
Think of the countless warning waves we had in Germany. The very complex German data protection law is also a good example of a large voltage field. This is the driving force behind stylistic blossoms, as was recently the case with a nationwide active political party with its website, which clearly violated German data protection law.
Would not the legislature be in duty?
If, so to speak, the legislator is already failing due to its own regulations, how should a freelancer avoid all "stumbling blocks" in everyday business ?!
And to come back to one of the greatest achievements of the 20th century - the Internet: As with every advance, there are two sides. Unfortunately, the risks have expanded due to the worldwide network and the risk of causing damage has “internationalized”.
Just think about who's reading your blog. Nowadays, you can distribute content, pictures, videos, etc. all over the world. This increases the risk of violating copyrights, name rights or personality rights, as well as the fact that the people concerned are able to determine this very quickly. Whether you are in Augsburg or in Barcelona ...
In which cases is the professional liability now pay exactly?
If you are a general practitioner, I should like to point out that a professional obligation should be tailored to the specific sector and to their specific professional risks. This may lead to differences in the content of the cases in which the obligation to work is paid.
In general, the professional liability is payable for property damage, personal injury and material damage, for which you are liable due to the legal regulations (eg in the BGB). Good professional liability insurers also assume the liability, which also results from contractual agreements with the customer or customer (so-called contractual liability). In addition, there are usually payments for infringements, breaches of confidentiality and data protection agreements, publication risks for own products or services, violations of competition law and, for example, virus damage.
Within the framework of the liability cover, for example, rent damages or damages on business trips, when participating in trade fairs or exhibitions, are paid. In general, there is always a passive legal protection, which takes the defense costs (eg attorneys, reviewers and court costs), if the self-employed or freelancer is wrongly accused and paid for cash.
With media liability, IT liability and consulting liability, exali.de offers three concepts, all of which are pretty similar at first glance ...
You correctly recognized that there is a common “denominator” for the three professional liability concepts, as some risk areas overlap.
Media liability is generally directed at creatives and media agencies. IT liability to IT and telecoms experts and consulting liability to advisory professions such as company consultants, trainers, coaches.
Can you differentiate that again exactly?
Yes gladly. Protection is also characterized by the fact that exali.de professional liability is based on the needs of the respective industry:
- With media liability, the policyholder can, for example, also protect himself from unsuccessful print orders and advertising advertisements or the faulty production of merchandising articles.
- The IT liability covers as a special feature also the fault-independent liability for the deviation from the agreed upon nature of services in the context of Service Level Agreements (SLAs). In addition, there is an optional service extension to insure certain contractual penalties from IT project contracts.
- The consulting liability offers a special feature such as the protection of personal liability from the activity as an interim manager (so-called personal DundO insurance).
In order to meet the risks of the information society and its negative impacts, 2013 has also been able to insure our own data damage through cybercriminals through all professional liability insurance policies.
Does this assure you of the consequences of a hacker attack? What then is paid?
We provide protection against costly peculiarities related to a hacker attack, a DoS attack, computer misuse, theft of data carriers and other data breaches by unauthorized third parties or employees.
In this context, costs for repairing or repairing one's own computer or IT systems, commissioning external computer forensic analysts or specialized lawyers (including criminal defense) as well as crisis management and PR are paid. In addition, additional costs for the rapid elimination or avoidance of interruption in the business are covered.
A question that interests many freelancers: Is it also possible to insure their loss of earnings?
First of all, a professional liability applies in general when the self-employed or self-employed person inflicts damage to a third party (eg customer or client). If the self-employed person suffers a loss of earnings, he / she is himself / herself harmed (in the insurance yargon, this is referred to as peculiar damage) and is therefore not insured. As far as the theory.
In practice, however, we can insure the loss of earnings, at least under certain circumstances, with our special service extensions. For all professional groups this is the rescission of the client from the project.
Why is such a thing necessary?
According to German law, a contracting authority is entitled to a right of withdrawal if the contractor does not render his services as agreed (eg creating a website, an article, a software, an expert opinion, etc.) despite improvement. In this case, the customer does not have to pay any more and can even reclaim advance payments already made. In such cases, professional liability replaces the loss of earnings (insurance margin: futile fee expenses) and the futile material costs (eg for business travel or research).
Especially for the IT industry, we also offer protection against loss of earnings if the project contract is terminated extraordinarily. In this case, the IT freelancer shall be reimbursed for the agreed fee until the date on which the ordinary termination according to the project contract was possible at the earliest. In addition, we can not currently protect our own losses.
In this context, I would like to explain to readers the so-called remuneration protection, which is part of all concepts. Insofar as the customer settles the agreed fee with an unjustified claim for damages and with this justification reduces or eliminates the earnings, the insurer will pay the court costs (eg legal fees, court costs and witness costs) for enforcing your loss of earnings. BGB = Civil Code
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