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Virtual assistant insurance claims: what can go wrong?

Jack of all trades, master of some?

Anyone running their own business will agree it’s not a typical 9 to 5 job by any stretch.

It takes a lot of elbow grease and the work can be long, arduous and time-consuming. Resources are sometimes scarce, and finding an extra pair of hands isn’t always easy. It’s not surprising then, that many feel overwhelmed as they battle to do literally everything.

So, more and more businesses are using you, the UK’s army of virtual assistants (VAs) to lighten the load.

While that’s a good thing for your business, it can lead to potential problems. Granted, most VA’s working lives are trouble-free, but with more work comes more risk. And that’s something you need to be aware of.

Without wanting to worry you too much, claims do happen. In the interests of ‘knowledge is power’, we think telling you about them will help – in our experience ignorance isn’t bliss.

Here we go…

Don’t get taken to the cleaners

An up-and-coming fashion retailer was getting lots of ad space in lots of glossy magazines, keeping it nice and busy with orders. That meant having less time to deal with the associated admin.

To make sure it still got done, it outsourced the admin to a VA. Part of this admin work included compiling and sending weekly sales and marketing reports.

Unfortunately, the VA had more than one retailer client. A mix up with two (very similar) email addresses meant one such report was sent to a competitor by mistake. And lots of confidential sales data was seen by lots of the wrong people.

See also  October 2015 Society of Virtual Assistants Newsletter

So what happened next?

Although the disgruntled retailer couldn’t prove the mistake had caused it a financial loss, it rightly claimed against the VA for breach of confidentiality. Obviously, it didn’t want a competitor having access to its data, nor did it want its planned marketing activity in front of prying eyes.

While it was a genuine mistake, the VA did have a legal case to answer. Essentially he’d breached its duty of care and was liable. That meant finding, and paying for, a solicitor to help sort it all out.

Or at least it would’ve done. Thankfully, breach of confidentiality is covered by professional indemnity insurance. In this case, the VA’s insurer appointed its own solicitor and paid for both the VA’s costs and the retailer’s too.

Total payout: £5,800 legal costs

Dear diary, I’m being sued

The director of a technology company needed another pair of hands to look after his diary. He’d spotted an opportunity to partner with a leading software firm, and calculated that working together could bring in another £11k for the year ahead.

A meeting was arranged for a date later that month. Or at least, that’s what everyone thought. Turns out the VA had pencilled it in for the week after it was meant to happen.

Unsurprisingly, the missed appointment meant no new business – and one very disgruntled director. He filed a, £11k claim against the VA, arguing that’s what her mistake had cost him.

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But here’s the rub.

The director didn’t actually lose any money. He lost out on an opportunity, yes, but a missed opportunity isn’t quantifiable damage. If someone claims for a specific loss, it’s up to them to prove they’ve actually lost it.

However, that doesn’t stop someone claiming in the first place. And no actual financial loss doesn’t necessarily mean case closed, either. In this case, although the VA wasn’t found liable for the £11k, she had been negligent in messing up the diary.

Her professional indemnity insurer paid to defend her, and took control of negotiating with her client. In the end, her insurer offered the director a goodwill settlement to acknowledge her negligence and to stop the problem escalating.

Total payout: £4,512 in legal costs and damages

(Your tax code keeps lifting me) higher and higher

A design agency needed someone to handle the payroll for their team, so it took on a VA with bookkeeping skills.

Meanwhile, a recent run of newly won clients earned one lucky employee a promotion and a generous pay rise.

All good. Except, if we skip ahead several months we find the employee reading an alarming letter from HMRC, asking him for the princely sum of £3,248 in unpaid tax.

Why? Because his pay rise meant he’d moved to a higher tax bracket. Problem is, his tax code wasn’t updated at the same time.

When stuff like this happens, it’s the employer who usually foots the bill. But if they’re using a VA to do it instead? Yep, you guessed it …

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In a fairly open and shut case, the forgetful VA’s professional indemnity insurance covered everything. The insurer managed to avoid too much legal to-ing and fro-ing by settling quickly, keeping everyone happy in the process.

It’s worth noting that this claim was notified many months after the mistake had been made. Thankfully the VA still had cover in place – if she’d cancelled her policy she wouldn’t have been covered (but would’ve still been liable).

So this is probably a good time to mention run-off. It’s bolt-on cover that starts when your main policy stops. It doesn’t cover any current or future work, but it does protect you by covering your past work if you decide to call it a day.

Total bill: £3,248 to cover the tax underpayment

Let’s stay together

As you can see, being a VA isn’t without its share of risks. Mistakes, no matter how innocent, have the potential to empty your bank account and destroy your working relationships. That’s no exaggeration.

If you can’t afford for that to happen, arming yourself with some suitable virtual assistants’ professional indemnity insurance will help. It means you can rest easy, safe in the knowledge that you and your business are protected.

And we think that’s virtually impossible to dispute.

insurance for virtual assistantsFor more information, call PolicyBee on 0345 222 5370, or click here or a quote.


  1. Heather Greig on 28 June, 2016 at 4:02 pm

    Excellent article Caroline. I also use Policy Bee for PII and PLI – it means I can sleep a little bit easier at night!

  2. Justina Thomas on 22 August, 2018 at 9:52 am

    Thank you for posting this article.
    I’m in the process of setting up my new VA business and want to know if you would advise on also purchasing public liability insurance in addition to professional indemnity insurance?

    Kind regards

    • Caroline on 22 August, 2018 at 10:39 am

      It’s usually not that much extra on the policy – maybe £30 over the year… And it’s well worth having for silly stuff like:
      Postie tripping on your path whilst delivering business mail and not being able to work for 8 weeks
      Or you spilling coffee all over your clients laptop at a coffee shop meeting

      Most VA policies include: professional indemnity, public liability and contents insurance. You might also want to add in subcontractor’s insurance, bookkeeping (or other service-specific cover) insurance, employers liability etc depending on what sort of a set up you have.

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