Common Consultant Mistakes—That Could Lead to Claims

There are few things more fulfilling for new consultants than signing clients and having the chance to do what they love under the structure of their own business. However it’s essential to protect yourself with professional liability insurance for consultants, otherwise, you could be setting yourself up for a lot of unnecessary stress and possible financial devastation. Learn from these common mistakes made by consultants.

Setting the Wrong Tone 

It’s not uncommon to fall into the trap of doing a little extra work for free, eagerly respond to messages and emails immediately and take calls when they really should have been scheduled. Clients see this as setting a tone for the entire contract, which backfires once they become accustomed to having responses in real-time, all of the time. Before you know it, both parties become frustrated and resentful.

Be very clear about professional boundaries from the start. Come to an understanding about working hours and response times and agree on how calls and meetings will be scheduled. Put this information in your contract and have both parties sign it. If you’ll be unavailable on certain days, let your clients know as far ahead of time as possible and ask that they do the same.

Failure to Establish Contracts 

Many consultants don’t establish a formal agreement because they’re worried it will cost them a gig. Move past this costly concern by understanding that quality contracts protect both parties. Make responsibilities and timelines clear, secure payments and fees, and put a formal agreement in place if the relationship does not work out.

Not Holding Clients Accountable

Don’t jump through hoops to complete tasks by unreasonable deadlines, allow clients to hand in deliverables late, or work with an unpaid invoice. There must be a clear understanding as to who is doing what and when it’s due. 

If a client schedules a call but isn’t reachable, doesn’t pay an invoice on time, or crosses a line, how will you handle it? Charging the client for the time you set aside for the call is not inappropriate and stopping all work until an invoice is paid is acceptable if guidelines are laid out in the contract beforehand. 

Treated like an Employee

You’re in a professional partnership with clients and doing work for them, not working for them. The distinction is important.

You don’t receive the benefits of a full-time employee, nor involved in daily business operations. You have been contracted to do a specific job, not to get caught up in office politics or shifting decisions of your client. If you’re ever on-site, you’re not obligated to jump in on tasks that are not outlined in your contract.

Developing Personal Relationships 

We all want to work in a friendly environment, but developing a personal relationship with a client is likely to cause blurred lines in the professional relationship. This can make objective decision-making and clear communication difficult in the long-run. Sure you can partake in social invitations, but know what to share and when to leave.

About Bozzuto & Co. Insurance Services, Inc.

Bozzuto & Company Insurance Services has provided business and personal insurance solutions to clients throughout California since its founding in 1981. Our experienced staff understands the unique needs that each person has when insuring their lives and their businesses, and we pride ourselves on our deeply personal customer service. We are happy to help you through every step of the insurance selection process. Contact us today at (800) 400-6394 to learn more about what we can do for you.