Private investigator insurance explained

Mention 'private investigator' and it's hard not to think of those old Hollywood films with mucky mac'd PIs sneaking around, busting bad guys.

A cliché, of course, and the reality is rather more mundane. It's more likely you'll be dealing with divorce cases, investigating tax fraud and looking into employee dishonesty.

But while you've got your eyes firmly focused on the case, who's keeping an eye on you? Who's got your back in case of trouble? If the answer's 'no one', then maybe it's time you weighed up the evidence in favour of private investigator insurance.

Because although writing reports and carrying out background checks might not sound sexy, it is risky. Accuse the wrong person and you could end up with a defamation claim against you. Overlook some evidence crucial to your client's investigation and you could get sued for negligence.

The last thing you need is to be investigated yourself. And that's where private investigator insurance can help.

What does private investigator professional indemnity insurance cover?

Real fears about private investigators 'operating in the shadows' and invading privacy have helped fuel new regulatory and data protection laws, putting PIs under more scrutiny than ever.

PI (professional indemnity this time) insurance doesn't cover anything illegal, of course. But it does cover a whole raft of errors and negligent acts, including defamation, breach of confidentiality and loss of documents or data.

If someone says you've done something wrong and makes a claim against you, your PI insurance is there to fight your corner. It pays for a legal expert to defend you and also covers any compensation you're liable for. Case closed.

Something else to note is that the ABI (Association of British Investigators), which works to raise standards in what is still an unregulated industry, stipulates its members must 'hold adequate professional indemnity insurance'. It sees it as a necessary mark of their professionalism.

Searching for clues

Don't worry. We wouldn't be so crass as to try and tell you how to do your job. But there are certain things you can do to make it less risky (from an insurance point of view, that is). Just think of the following as some practical steps towards self-preservation:

Protect your interests. Draw up a contract that spells out your terms of work and payment plus any complaints procedures. That way, you can deal with problems between you and your client quickly (and preferably out of court). Remember to include a section detailing your client's reasons for the investigation and what they intend to do with the information you give them – this reduces your liability in case of later disputes.

Vet your staff. If you're head of a surveillance company, you need to check all your staff are licensed, including employees, employers, managers, supervisors, directors and partners, and any other PI firms you work with. The maximum penalty for failing to do this is a fine of up to £5,000 and six months in prison.

Bone up on the law. If you find yourself straying into unknown legal territory, or in need of a recap on specific areas of law, professional bods like the Institute of Professional Investigators and the Association of British Investigators offer plenty of courses to warn you of the pitfalls.

Stay up to date. The government stated as far back as 2013 it's intention to regulate the private investigation industry and require all operators to be licensed. Since then, plans have become mired in dispute and delayed again and again. It'll happen eventually though, so make sure you stay alert to any developments.

So that's the case in favour of private investigator insurance. If you've now got all the evidence you need, you can get a quick quote here. Or call us on 0345 222 5391.

Image used under license from Shutterstock.