Engaging External Professionals: Risks & Rewards
Element 6: Professional Services
Lesson duration is: 60 minItems in this lesson
Element 6: Professional Services
What do you already know about working with external professional services?
Learning Objectives
At the end of the lesson you will be able to:
- Identify key third-party professionals and their roles
- Explain risks of using professional services
- Understand Professional Indemnity Insurance (PII)
- Interpret Service Level Agreements (SLAs)
- Apply knowledge to real-world scenarios
What Are Professional Services?
Professional services are specialist services provided by external experts to support organisational decision-making.
Examples: legal, financial, insurance, technical, risk & compliance services.
Key Third-Party Professional Roles
Roles include:
insurance brokers (risk advice),
risk analysts (risk assessment), mortgage advisors (financial advice),
external auditors (financial review),
medical experts (specialist opinions).
Why Use Third-Party Professionals?
Organisations use third parties to access:
specialist knowledge,
reduce workload,
ensure compliance,
improve decisions
demonstrate due diligence.
Risks of Using External Professionals
Risks include:
Ethical concerns
Data breaches
Compliance failures
High costs
Reputational damage
Managing Third-Party Risk
Manage risk by: carefully selecting providers, using clear contracts and SLAs, monitoring performance, maintaining PII, and regular reviews.
Professional Indemnity Insurance (PII)
Does not cover deliberate wrongdoing,
fraud,
criminal acts,
claims outside policy terms.
What PII Does Not Cover
What PII Covers
Protects against financial loss from negligence,
errors,
misleading advice,
breach of professional duty.
Write down 3 things you learned in this lesson.
Write down 2 things you want to know more about.
Ask 1 question about something you haven't quite understood yet.
