Seven Questions to Ask Your Trainer About Insurance Liability

In today’s world many trainers and training organizations come and go…and the only way to protect your organization is by making sure that your trainer is sufficiently covered to bear liability. Here we list 7 questions you should ask your training organization or trainer to make sure you understand the limits of their liability. What you don’t know can devastate your company.

1) Does your trainer carry professional liability insurance?

In order to be insured for professional liability your trainer/trainer organization must meet a number of certified standards, such as Best practices, professional ethics, honorary organizations, financial well-being and continuing education.

Professional Liability Insurance (Errors and Omissions Insurance) is your most critical coverage. Professional liability coverage protects you against loss from a claim of alleged negligent acts, errors or omissions in the performance of your professional services. This might include loss of client data, software or system failure, claims of non-performance, or negligent oversell.

Professional liability claims arise from a contracted service, rather than a product or operation. It is a supplementary insurance which enhances a standard business liability coverage. The coverages normally include financial losses and expenses created by claims from clients resulting in negligence, omission or error. It can sometimes also include coverage against libel, breach of contract and slander. Many standard insurance polices for business’ do not cover client claims of negligence.

Certain professions, such as doctors, contractors, and insurance agents, carry a specialized professional liability insurance, which is known by most as E&O or Errors and Omission Insurance. This specialized coverage typically range from $250,000/$500,000 to $2,000,000/$4,000,000. This insurance features a claim limit as the maximum that will be paid for any single event and an annual limit which is the maximum that would be paid in any one single year.

According to the Insurance Directory findinsurance.us, “Every service professional, from contractors to software engineers should consider carrying professional liability insurance. According to a recent study by insurance consultancy Tillinghast-Towers Perrin, U.S. tort costs increased 14 percent in 2001 to $205 billion.”

2) If the trainer instructs your employee in a safety procedure that causes the employee to be hurt, what is your organization's liability?

It is important to be certain that you can assign the employees liability claim to the trainer that you hired. Otherwise you would be solely responsible for any subsequent problems, financial responsibility, workers compensation and possible lawsuits that could result if the trainer or training organization that you hire for your employees acts in a negligent act.

3) Does your trainer carry general liability insurance?

Liability, in law, is an obligation of one party to another, usually to compensate financially.

By a negligent act, your trainer damages your property or hurts a person at your location; your insurance may not provide coverage. You will need to look for insurance coverage from the trainer or training organization that you hired. Otherwise you might be solely responsible for any subsequent financial responsibility.

4) Does your trainer carry worker compensation insurance?

Workers Compensation Insurance provides coverage by employers for some part of the cost of injuries, or in some cases of occupational diseases, received by employees in the course of their work.

If your trainer or an employee of the training organization is hurt while working for you, that person may be able to file an insurance claim under your insurance policy. Yes that’s correct, if a trainer or an employee of their organization is injured on your premises you could be held financially responsible for their injuries.

5) Does the contract your trainer wants you to sign address insurance issues of each party?

The insurance requirements need to be in writing. Ask the trainer or training organization if they carry these important insurance requirements. Inquire on their limits of coverage or ask to be included as an “additional insured” especially if you contract with them for the training at your business.

6) Are your trainer’s insurance limits high enough to cover possible insurance exposures?

If your trainer or an employee of the trainer is hurt while working for you, that person may be able to file an insurance claim under your insurance policy. By a negligent act, your trainer damages your property or hurts a person at your location; your insurance may not provide coverage. You will need to look for insurance coverage from the trainer.

7) Will your trainer issue you a certificate of insurance, naming you as an additional insured?

This will allow you to know what insurance the trainer has in force. Further, the additional insured will allow you to file an insurance claim against the negligence of the trainer, if something occurred.

Know your trainer's limits of coverage for your protection:

Safeguard your business by making sure that your trainer or training organization has the right amount of insurance to in the event of a catastrophic loss or frivolous lawsuit.

Safeguard your business by making sure that the training organization or trainer you trust to lead you in your safety practices can provide you the additional assurance that their practice of business is licensed and legitimate.

PLEASE NOTE: The information contained in this web site is for general guidance on matters of interest only. The application and impact of laws can vary widely based on the specific facts involved. Accordingly, the information on this web site is provided with the understanding that the authors and publishers are not herein engaged in rendering legal services. As such, it should not be used as a substitute for consultation with professional legal advisers.