Professional indemnity insurance is a legal requirement in many industries.
If your business provides a professional service or advice then there is a chance of human error or a disgruntled client - Professional indemity insurance can help you when you are on the receiving end of a lawsuit.
How much does professional indemnity insurance cost?
That's tough to say. It'll depend on a few different factors including the type of work you do, your annual revenue, and the level of cover you'd like.
We put every effort into ensuring information on Finder is accurate. This article was reviewed by Justine McLean from our Editorial Review Board as part of our fact checking process.
In 2025, we requested three different quotes from six different insurers, to get a picture of how much professional indemnity insurance might cost for a self-employed tax agent with $150,000 annual revenue. Here's what we found:
Insurer
Cost for $250,000 cover
Cost for $500,000 cover
Cost for $1,000,000 cover
Excess payable on claims
$684.75
$742.50
$858.00
$1,000
$511.50
$511.50
$546.15
$0
$1,074.56
$1,135.20
$1,377.75
$0
$430.65
$430.65
$511.50
$2,500
$563.78
$695.52
$869.55
$1,000
$736.73
$800.25
$896.12
$750
Average cost
$667.00
$719.27
$843.18
$1,292
Data was taken from our quoting engine in February 2025 based on a sole trader tax agent looking for $250,000 in professional indemnity insurance cover.
What's covered by professional indemnity
Professional indemnity is designed to protect you and your business if you ever make a mistake at work and the client sues. It'll also protect you if you didn't make the mistake, but you have an unhappy client who claims you did. But it won't protect against everything.
Covered
Breach of duty. You fail to lodge a client's important paperwork in time.
Breach of privacy or confidentiality. You accidentally share a customer's personal information online.
Defamation, libel or slander. You publish something online which damages a person's reputation.
Intellectual property infringement. You accidentally breach copyright laws in a design you give to a client.
Legal fees. The legal costs of investigating, defending and settling claims.
Reputation repair. Public relations costs deigned to repair your reputation if it's damaged.
Loss or damage to documents. A tax agency is severely damaged along with receipts given by clients.
Not Covered
Issues known prior to insurance. You receive a complaint from a customer then take out cover
Criminal conduct. You use your client's information to open a credit card.
Damage to property. You visit a client's home and accidentally break something.
Intentional acts. You use below-standard materials for a house you are working on.
Fraud and dishonesty. You claim to have qualifications that you do not.
Fines and penalties. If you are ordered to pay a fine, this is unlikely to be covered.
Bankruptcy. If your business goes bankrupt, your policy won't cover related claims.
Accidental injury. You construct a faulty wall which ends up collapsing on someone.
Key factors that will affect your quote
Professional indemnity insurance isn't one-size-fits-all. Lots of different factors are taken into account when calculating the price you pay. They include:
Number of staff. The more staff employed at your company, the higher your premium will be. That's because as the number of employees grows, so does the chance of human error.
Annual turnover. Businesses with a lower annual turnover will enjoy lower premiums. That's because you face less financial risk than others.
Type of client. If you work on large-scale, multi-million dollar projects, your premiums will be higher than if your clientele is on the lower end of the spectrum.
Industry. Certain industries carry higher premiums as the potential cost of mistakes is higher. For example, a lawyer would face higher premiums than a graphic designer.
Claims history. Have you been sued before? If so, you'll likely face higher premiums than someone who hasn't.
Benefits. Not all policies are created equal. A more comprehensive level of cover will cost you more money.
Excess. The excess is the amount you pay first, if you ever have to claim. The higher the excess, the lower your monthly premiums.
Do I actually need professional indemnity insurance?
In some cases, yes.
Professional indemnity insurance is a legal requirement in many industries. These vary between states so it's worth double checking.
Professional indemnity insurance is typically a basic requirement in business contracts, especially if you are dealing with other companies or councils.
Professional associations and industry bodies often require their members to have professional indemnity insurance.
Some industries require professionals to have professional indemnity insurance before they receive full accreditation.
Even if you don't technically need professional indemnity insurance, it's still a good idea to consider it.
No matter how careful you are, there is always the risk of error. Further, illegitimate claims can also end up costing you a lot of money, not to mention your reputation.
Professional indemnity insurance ensures your business can continue to operate despite having to cover legal costs.
Case studies for specific occupations
Here are some real life examples of professional indemnity insurance claims:
Accountant
An accountant advised their client that an expense was tax-deductible. The ATO investigated the claim and fined the client. The accountant was liable to pay legal fees to defend the claim and pay compensation to the client. Having professional indemnity insurance ensured those costs were covered.
Building inspector
A building inspector completed a pre-purchase report for a client buying a new house. It was later found that there was significant structural damage in the roof that was not identified in the report. The client sued the building inspector for damages. The building inspector's expenses were covered by their PI insurance policy.
Event manager
An event coordinator double-booked a room at a function centre, resulting in the cancellation of one of the events. The client whose event was cancelled made a claim seeking damages for lost business and to recoup expenses. The events coordinator was able to cover these costs because they had a PI policy in place.
Why price isn't everything
We understand that price is important - but it shouldn't be the only factor you look at when choosing professional indemnity insurance. Keep an eye out for insurers that:
Understand your industry and manage policies of other similar businesses.
Can produce evidence of favourable outcomes for clients
Are approved by your industry's governing body or membership association
Have clear policy guidelines regarding inclusions and exclusions
Take a personal approach and assess your business specifically
It is important to get a number of quotes and talk to a variety of insurers before committing to any particular policy.
Some important things to understand
When looking for professional indemnity insurance, you'll come across some terms you might not have heard of before. We've cleared them up for you here.
Term
What it means
Claims made
If you switch insurers after the event occurs, but the claim is made under a new insurer, the new insurer must handle the claim.
Run-off cover
Run off cover extends the policy after you have stopped trading. For example, if someone makes a claim after you've sold your business or retired.
Fidelity insurance
An additional cover that protects you against dishonest acts by employees. It can be taken out as a separate policy or included as an extension.
Policy retroactive date
The date from which your professional indemnity insurer will cover you. Typically, the retroactive date will either be unlimited or specified.
An unlimited retroactive date means the insurer will cover claims regardless of when they occurred. A specific retroactive date will only offer cover after a specific date.
Cost inclusive
Legal defence costs are included in the maximum amount your insurer will pay for a claim.
Cost exclusive
Legal defence costs are covered in addition to the limit of indemnity, which means it could be a more desirable option.
Talk to a broker about professional indemnity insurance
Professional indemnity insurance is complicated. Fill out the form below, to receive free advice from a broker.
Receive a Quote for Business Insurance
If you are ready to speak with a consultant about different business insurance options available, simply enter your details in the form. Keep reading if you want to learn more about the different types of cover available.
Professional indemnity insurance, sometimes called professional liability insurance, is designed to cover the potential costs that can come from workplace mistakes - or alleged mistakes - for self-employed people and businesses.
For example, if you survey a house and tell the prospective buyers that it's sound, but they later discover it has major structural faults, they may sue. Your professional indemnity insurance would help cover the costs of that court case.
Professional indemnity insurance can also protect you against unfair claims. For example, if a client falsely accuses you of shoddy work. Your policy would cover the cost of investigation, legal fees, and even the cost of defending your reputation.
That's another tricky one. Some industries set a mandatory minimum, but others don't.
The best way to figure out exactly how much cover you need is to talk to a broker or a financial advisor. They'll be able to help you pinpoint which policy might be best, and what level of cover is appropriate for your business.
Was this content helpful to you?
Thank you for your feedback!
To make sure you get accurate and helpful information, this guide has been reviewed by Justine Mclean, a member of Finder's Editorial Review Board.
Alex Reid is Finder’s business insurance cadet. He has a Master of Marketing from the University of Technology Sydney, with a background in business and sales. When not writing about business insurance for Finder he's a keen scuba diver, recently completed his 200th hour underwater and his PADI Divemaster certification. Before working at Finder he lived in Hangzhou China, where he studied Mandarin and Chinese culture. See full bio
Wanting to find out about professional indemnity insurance for a midwife doing pre and postnatal care like a doula. Not doing births
Finder
JamesMay 10, 2023Finder
Hi Jenny,
Thanks for reaching out. Professional indemnity cover is an important consideration for doulas. You could start by completing the broker form near the end of this article to get more information on your specific needs.
Best wishes,
James
AdamJuly 17, 2018
How much does business insurance usually cost?
JoelJuly 17, 2018
Hi Adam,
Thanks for leaving a question on finder.
As with most types of protective insurance, the cost for cover to be taken out can vary dramatically depending on the insured’s cover needs. In the case of professional indemnity insurance, this will depend on whether the policy is for a sole trader or for a business looking to provide cover for a significant number of employees. While sole traders may be able to get adequate cover for just a few hundred dollars, the cost of insuring a multinational company could run into the hundreds of thousands of dollars. Key factors that impact what you pay include:
– Number of staff employed by company and annual turnover. Sole traders or companies with say 15 employees won’t require the same level of cover as large-scale organisation.
– Types of clients that company/professional services. Professionals that work on large-scale,. multi-million dollar projects will require a higher level of cover than smaller firms.
– Industry. The nature of the service provided and the level of risk for claims being made will impact how much is paid for cover.
Policy inclusions and exclusions. Obviously more comprehensive protection packages with increased levels of cover will cost more than more basic policies.
– The cost of professional indemnity insurance is largely based on the percentage of your companies total legal spend and the likelihood of the company being taken to court. The insurer that you go with and the policy that you choose will also play a major role in the final cost of cover.
To get a professional, personalized advice about business insurance, I suggest you fill out the form above to speak to an insurance broker.
Cheers,
Joel
ChristinaAugust 3, 2017
Regarding aged care and disability services, are cheaper premium payments possible under professional indemnity insurance if regular employee training is provided to staff?
ArnoldAugust 4, 2017
Hi Christina,
Thanks for your inquiry.
Usually, if regular employee training is provided to the staff there is a possibility of lowering the premiums. In order to confirm this, you may have to contact your insurer.
Hope this information helped.
Cheers,
Arnold
AllieJuly 18, 2017
I am establishing an online business that sells parenting resources and ebooks. I don’t have any qualifications as such but have developed my resources based on experience. Do I need professional indemnity insurance and/or products liability insurance?
thanks
JonathanAugust 1, 2017
Hello Allie,
Thank you for your inquiry.
As of the moment, recommending which cover to take is within the scope of a licensed insurance broker. You can leave your details on the “Enquiry Now” form so that you will be interviewed and assessed to know which type of covers suits your needs.
Hope this helps.
Cheers,
Jonathan
LauraAugust 1, 2016
Can I cancel my policy if I wish at any time? And is there any cancellation fee prior to the termination date of a professional indemnity insurance?
Finder
RichardAugust 2, 2016Finder
Hi Laura,
Thanks for your question. finder.com.au is a comparison service and we are not permitted to provide our users with personalised financial advice. Generally, you are entitled to cancel your policy as soon as your insurer receives a written request from you to cancel the policy. Whether or not there is a cancellation fee will depend on your insurer, as there may be an administration fee applicable.
Why do accountants need professional indemnity insurance? Why do they need public liability insurance? This article looks at the many risks that accountants are exposed to in the course of doing business and will hopefully convince every accountant who reads it that PI Insurance is not something they can afford to be without.
Nursing is a vital profession in hospitals and nursing homes around Australia, but the people who work as nurses are exposed to a unique range of risks. If a nurse were to make a mistake or an error of judgement — for example administer the wrong medication, fail to follow a doctor’s instructions or give incorrect advice to a patient — they could find themselves the subject of a lawsuit for a breach of their professional duty.
This is where professional indemnity insurance shows its worth. This type of cover offers much-needed financial protection for nurses against claims of negligence or malpractice. It covers the cost of your legal defence as well as any compensation you may be legally required to pay to a third party. Public relations costs to repair your professional image are also covered by professional indemnity policies.
In order to find the right professional indemnity insurance policy for you, compare policies at finder.com.au and seek advice from colleagues. Compare quotes from a number of insurers and seek help from an insurance consultant if required.
Want protection against liability and negligence claims? Find out why these two forms of cover are essential for many businesses.
Important information about this website
Finder makes money from featured partners, but editorial opinions are our own.
Finder is one of Australia's leading comparison websites. We are committed to our readers and stand by our editorial principles.
We try to take an open and transparent approach and provide a broad-based comparison service. However, you should be aware that while we are an independently owned service, our comparison service does not include all providers or all products available in the market.
Some product issuers may provide products or offer services through multiple brands, associated companies or different labeling arrangements. This can make it difficult for consumers to compare alternatives or identify the companies behind the products. However, we aim to provide information to enable consumers to understand these issues.
We make money by featuring products on our site. Compensation received from the providers featured on our site can influence which products we write about as well as where and how products appear on our page, but the order or placement of these products does not influence our assessment or opinions of them, nor is it an endorsement or recommendation for them.
Products marked as 'Top Pick', 'Promoted' or 'Advertisement' are prominently displayed either as a result of a commercial advertising arrangement or to highlight a particular product, provider or feature. Finder may receive remuneration from the Provider if you click on the related link, purchase or enquire about the product. Finder's decision to show a 'promoted' product is neither a recommendation that the product is appropriate for you nor an indication that the product is the best in its category. We encourage you to use the tools and information we provide to compare your options.
Where our site links to particular products or displays 'Go to site' buttons, we may receive a commission, referral fee or payment when you click on those buttons or apply for a product.
When products are grouped in a table or list, the order in which they are initially sorted may be influenced by a range of factors including price, fees and discounts; commercial partnerships; product features; and brand popularity. We provide tools so you can sort and filter these lists to highlight features that matter to you.
Please read our website terms of use and privacy policy for more information about our services and our approach to privacy.
We update our data regularly, but information can change between updates. Confirm details with the provider you're interested in before making a decision.
How likely would you be to recommend Finder to a friend or colleague?
0
1
2
3
4
5
6
7
8
9
10
Very UnlikelyExtremely Likely
Required
Thank you for your feedback.
Our goal is to create the best possible product, and your thoughts, ideas and suggestions play a major role in helping us identify opportunities to improve.
Wanting to find out about professional indemnity insurance for a midwife doing pre and postnatal care like a doula. Not doing births
Hi Jenny,
Thanks for reaching out. Professional indemnity cover is an important consideration for doulas. You could start by completing the broker form near the end of this article to get more information on your specific needs.
Best wishes,
James
How much does business insurance usually cost?
Hi Adam,
Thanks for leaving a question on finder.
As with most types of protective insurance, the cost for cover to be taken out can vary dramatically depending on the insured’s cover needs. In the case of professional indemnity insurance, this will depend on whether the policy is for a sole trader or for a business looking to provide cover for a significant number of employees. While sole traders may be able to get adequate cover for just a few hundred dollars, the cost of insuring a multinational company could run into the hundreds of thousands of dollars. Key factors that impact what you pay include:
– Number of staff employed by company and annual turnover. Sole traders or companies with say 15 employees won’t require the same level of cover as large-scale organisation.
– Types of clients that company/professional services. Professionals that work on large-scale,. multi-million dollar projects will require a higher level of cover than smaller firms.
– Industry. The nature of the service provided and the level of risk for claims being made will impact how much is paid for cover.
Policy inclusions and exclusions. Obviously more comprehensive protection packages with increased levels of cover will cost more than more basic policies.
– The cost of professional indemnity insurance is largely based on the percentage of your companies total legal spend and the likelihood of the company being taken to court. The insurer that you go with and the policy that you choose will also play a major role in the final cost of cover.
To get a professional, personalized advice about business insurance, I suggest you fill out the form above to speak to an insurance broker.
Cheers,
Joel
Regarding aged care and disability services, are cheaper premium payments possible under professional indemnity insurance if regular employee training is provided to staff?
Hi Christina,
Thanks for your inquiry.
Usually, if regular employee training is provided to the staff there is a possibility of lowering the premiums. In order to confirm this, you may have to contact your insurer.
Hope this information helped.
Cheers,
Arnold
I am establishing an online business that sells parenting resources and ebooks. I don’t have any qualifications as such but have developed my resources based on experience. Do I need professional indemnity insurance and/or products liability insurance?
thanks
Hello Allie,
Thank you for your inquiry.
As of the moment, recommending which cover to take is within the scope of a licensed insurance broker. You can leave your details on the “Enquiry Now” form so that you will be interviewed and assessed to know which type of covers suits your needs.
Hope this helps.
Cheers,
Jonathan
Can I cancel my policy if I wish at any time? And is there any cancellation fee prior to the termination date of a professional indemnity insurance?
Hi Laura,
Thanks for your question. finder.com.au is a comparison service and we are not permitted to provide our users with personalised financial advice. Generally, you are entitled to cancel your policy as soon as your insurer receives a written request from you to cancel the policy. Whether or not there is a cancellation fee will depend on your insurer, as there may be an administration fee applicable.
I hope this was helpful,
Richard