Professional Liability Insurance – Do Coaches Need It?
By Diane Brennan
I have carried professional liability insurance as a coach since 2002, a little over a year after I started my own business. I took the plunge into acquiring the professional liability insurance primarily because of my years of experience in healthcare where litigious activity is high.
Shortly after initiating my first policy, one of my organizational clients requested I present a declarations page demonstrating ‚ÄúEvidence of Insurance.”
While coaches are not in the business of advice giving and generally include a disclaimer of liability within the coaching contract, professional liability insurance offers protection in the event of a claim against you as a professional. Claims and lawsuits against coaches are not rampant at this point, though they can occur and are more likely as coaching continues to grow. This concern is not limited to the US, which is why professional coaching bodies have sought out insurers from various parts of the world.
In 2002, professional liability insurance was not so prevalent for coaches. Those who came from psychology and therapy backgrounds were sometimes able to find coverage through their previous professional associations. My first policy had a $1,500 annual premium and subsequent years increased to nearly $3,000 annually through a private insurance company.
Today professional coaching bodies have arrangements with insurers to underwrite professional liability policies specifically for coaches, and premiums average between $300 and $600 annually for a $1,000,000 claims made policy.
Over the past several years, I have found organizations hiring coaches to work with executives and teams are more consistently requesting evidence of professional liability insurance.
More recently, I have seen and heard from other coaches about organizations detailing the amount of coverage required for professional liability and other types of business and liability insurance as part of their request for proposal.
Concern around professional liability is not limited to work within organizations. Individual clients coaches work with can create risk as well, particularly around issues of agreement and expectations.
Bottom line is that as coaching grows, so does the risk and expectation that we see occur in other professional fields such as law and medicine. Depending on the focus of your work or the legal system within your part of the world, professional liability may not be a focus at this point.
However, it is something to consider.
What are you seeing related to professional liability insurance for coaches?
Are you someone who carries this type of insurance? Have you always been a coach or have you come from a field where professional liability insurance was expected?
What do you anticipate for the future?
Comment by Angela Spaxman on 28 May 2009:
Diane, thanks for posting on this interesting topic.
I’ve got a different perspective because, like Dee, I don’t live in a very litigious society and I’ve never worked in a litigious industry. I’ve held coverage in the past for adhoc corporate training events where there is a risk of personal injury. I can understand how someone might sue if there were an accident created by an activity I was leading. Nowadays as a coach working both inside and outside organizations, I suppose there’s a risk I might hurt someone’s feelings. Can someone really sue me for that?
As long as I don’t over-promise on my services, I feel very safe from litigation with the biggest risk being that I might have to refund someone’s fees. I also don’t believe that things will get worse. As coaching and coaches mature, litigation will become even rarer. (My beliefs create my reality!)
Dee, on your question, I know that Lockton Insurance covers coaches and it’s not necessary to be a member of a coaching association to receive their best rates.
Cheers,
Angela
President of the International Association of Coaching
http://www.certifiedcoach.org
Comment by Dee on 27 May 2009:
Hi Diane, thank you for your post!
I don’t hail from a very litigious society, yet I always felt I should have some cover “just in case.” I spoke with seasoned international trainers and consultants who felt it was not necessary, citing the disclaimer you mentioned, the fact that a relative newcomer like myself doesn’t have that many resources worth suing over in the first place, and the usual practice of “satisfaction or your money back.” I still tried to obtain insurance through general agents who were not able to supply me with a quote.
Can you tell me whether you have to be an ICF member in order to obtain the rates offered by their suppliers? Looking forward to other coaches’ take on this, too.
Best, Dee