What is one key benefit of having professional indemnity insurance?

Having professional indemnity insurance provides essential coverage for legal costs associated with negligence claims, which is key for professionals who offer advice or services. This insurance protects businesses from the financial fallout that can occur when a client alleges that they suffered a loss due to professional neglect, errors, or omissions.

When a claim is made against a professional, the legal costs of defending that claim can be substantial, even if the claim is ultimately found to be unsubstantiated. Professional indemnity insurance alleviates this burden by covering not only the legal fees but also any compensation that may need to be paid if the claim is upheld.

In contrast, the other options do not accurately describe the primary functions of professional indemnity insurance. For instance, it does not guarantee payment regardless of the circumstances, as claims must be valid and substantiated. It also does not cover physical assets; that role is typically served by property insurance. Lastly, while some professions may require this type of insurance due to regulatory standards, it is not universally mandated by law for all businesses. Thus, option B correctly highlights the critical benefit of coverage for legal costs stemming from negligence claims, making it the most relevant choice.