Understanding insurance for recruitment consultants

The success of a business is made up by a mix of factors like marketing, balancing the books and importantly hiring the right talent to do the job. It’s an area that many businesses invest the resources in, employing recruitment consultants to seek out the best candidates to get the job done.  

Businesses put their trust in you to find candidates with the right qualifications, experience and fit for the company’s culture. This is an acquired skill that takes a lot of responsibility to deliver and meet the expectations of your clients. 

With so much accountability on the line, it makes sense to ensure that you have the right protection in place to support your recruitment consultancy. Let’s take a look at the importance of the different kinds of business insurances you need to think about. 

1. Professional Indemnity insurance* 

 As a recruitment consultant, you have the skills and expertise to match the right people with the right employment opportunities. It involves experience and a strong knowledge of the industry and related laws. Working with contracts, agreements and ensuring you meet the requirements of your clients means there is always a chance for things to not go to plan.  

The role of a recruitment consultant is more than just shortlisting potential clients and advertising positions. You still have a duty of care to uphold to your clients, even after your candidates have been placed in a position. 

The last thing you want to be facing is a claim where you and your recruitment consultancy business is placed into jeopardy, causing damage to your finances and professional reputation. This is where Professional Indemnity insurance can provide the safeguard and peace of mind your business needs. 

These are some examples of risk which could impact on your recruitment consultancy business: 

  • Not conducting a proper background, reference or qualification checks of a potential employee that could potentially lead to  financial loss for your client 
  • Placing a candidate in a position which they are not qualified or suitable for 
  • Providing negligent advice about procedures or payroll 
  • Not acting in the best interests of your clients or failing to follow their instructions 
  • Discrimination and unethical behaviour 
  • Breach of confidentiality  

Even as an expert in your recruiting field, mistakes can happen to the best of us no matter how much care you take.  

Professional Indemnity insurance is an important form of protection to consider as a recruitment consultant when providing specialist services or professional advice.  It is designed to respond to claims against your business for losses as a result of actual or alleged negligent acts or omissions in the provision of your professional service or advice. Professional Indemnity insurance will also assist with the legal costs associated with responding to or managing claims which are covered by the policy.  

Depending on the type of Professional Indemnity insurance policy you take out, it can typically provide cover for: 

  • Payment of compensation as a result of a claim, including but not limited to Court awarded damages
  • An award of legal costs against you
  • Reasonable legal costs incurred in defending or responding to the claim
  • Claim investigation costs
  • Disciplinary proceeding costs

The following are not typically covered under your Professional Indemnity insurance policy: 

  • Intentional damage
  • Contractual liabilities
  • Professional fees
  • Known claims and circumstances
  • Fraud and dishonesty

2. Public Liability insurance*

Public Liability insurance is one of the vital insurances you need to consider as a recruitment consultant. It is designed to provide protection for you and your business in the event a client, supplier or a member of the public is injured or sustains property damage as a result of your negligent business activities and brings a claim against you.  

When you work closely with your clients either within an office or out on location,  there is a potential risk for mishaps or accidents to occur. Something as simple as a client slipping over at your premises injuring themselves could result in a costly claim.  

A Public Liability insurance policy will typically provide cover for: 

  • personal injury suffered by a third party (e.g. a customer, supplier or member of the public) due to your negligent business activities
  • damage to property owned by a third party due to your negligent business activities
  • legal and defence costs associated with a covered claim

It will typically not provide cover for: 

  • Injuries to your employees
  • Damage to your own property
  • Costs of rectifying faulty workmanship
  • Professional negligence
  • Contractual liability
  • Events occurring before or after the policy period

3. Business Insurance*

There are a range of different types of Business Insurance coverages available to suit your recruitment consultancy business. These are a few to keep in mind when looking at protecting your business. 

  • Building*: if you own your business premises you will need to consider having some form of protection. Building Insurance covers your building if it is damaged by an insured event, such as fire, storm, malicious activity or other event as defined by the policy. 
  • Contents*: Covers your business contents or stock if they were damaged in a fire, storm or due to malicious damage or some other defined event listed in the policy 
  • Business Interruption*: provides protection for the loss of income and increased costs of operating your business caused by a specified insured event (such as property damage or fire).  It is also designed to assist your business to recover from an insured event by paying ongoing expenses (such as wages or rent).

It is important to note that Business Interruption cover is an additional cover option available when you take out a Business Insurance policy. 

  • Portable Equipment*: also known as General Property insurance, covers you for loss and damage to items of portable equipment associated with your business. These can include tools of trade and items of stock.

4. Cyber Liability*

Consider the client data or personal information you may be storing and the consequences if it were to be compromised. Cyber Liability insurance helps to protect you from claims and supports your profitability in the event of a cyber breach or attack.  

Arrange your business insurance today 

Get peace of mind knowing that your recruitment business has the appropriate insurances in place, protecting it from unwanted challenges with BizCover. Our online platform takes the hassle out of shopping around for your insurance, with multiple quotes from selected leading Australian insurers provided in minutes.  

Doing everything online means there’s no mountain of paperwork to fill out, with your certificate of currency and policy details emailed instantly to your inbox. Experience insurance made easy today. 

*As with any insurance, cover will be subject to the terms, conditions and exclusions contained in the policy wording. The information contained on this web page is general only and should not be relied upon as advice.

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