Private investigators perform a variety of functions for companies or individuals in the areas of information gathering and security. They also do work for attorneys, insurance companies and public agencies. All this activity requires private investigator liability insurance for the individual or the firm involved. Read on for more information about PI coverage.
Private investigators work in a surprisingly large number of areas. Here are some of the functions performed by private investigators:
The right insurance for private investigators will vary from one business to another. If you are a PI, you may need a number of different insurance policies to completely cover your risks. For starters, most PIs require the same general types of insurance as any business:
In addition, depending on the type of work you do and whether you hire employees, you may need a number of specialized coverages, such as:
A great deal of the work done by private investigators involves researching information or developing data that will be used by others to make significant decisions, such as choices regarding hiring or firing, marriage, contracts, or whether or not to do business with another party.
As a private investigator, you may find yourself responsible for a financial loss by another person or business in a number of ways. For example, you may face this risk if:
These situations will not be covered by a general liability policy because there is no bodily injury or property damage involved. Only a professional liability policy will protect you in this situation. "Errors and omissions" or "E & O" risks are inherent in any business that provides consulting services or provides information and advice, and this is particularly true of PIs.
Professional liability for private investigators may be one of the most important coverages you can buy to protect yourself against liability risks.
Some private investigator work can involve situations where physical confrontation may be necessary. For example, you may face this risk if you are involved in any of the following:
In order to get the proper protection, you will need for your insurance company to amend or waive the assault and battery exclusion in a standard general liability policy. Only a company specializing in private investigator liability insurance will consider taking this step.
Some of the work done by private investigators involves guarding or securing property. For example, a department store might hire you as a PI if it is experiencing substantial inventory shortages and suspects that some of its employees are to blame. As the private investigator hired to look into the situation, you would have access to the entire store. A difficult insurance situation can arise if you inadvertently cause damage to some of the store's property while looking for evidence.
A standard general liability policy excludes liability for property in the "care, custody or control" of the insured. Your insurance carrier could well exert this exclusion in this scenario. The solution is to work with your insurance agent to create an amendment to the basic policy, providing a sub-limit for property damage otherwise excluded by the care, custody and control provision.
This is highly technical work and you need a knowledgeable agent who specializes in commercial coverage to help you through this and other concerns pertaining to private investigator insurance coverage.
As a private investigator, you may be called upon to perform a wide range of services, many of them involving potential exposure to legal action if you make a mistake, or do not complete an agreed-upon duty as expected. Only a well-designed insurance program will offer you the protection you need.
Research the costs and the options before you buy. It's important to get a few quotes first, and consider what risks and liabilities you face in your line of work. Consulting with a lawyer, financial planner, and an insurance agent can give you some clear direction on the kinds of coverage you need to stay protected.