There’s a very simple reason to consider professional liability insurance for your business: No other business insurance coverage can protect you from a mistake, error or or omission during the course of providing a professional service. If a client or customer sues you because of an error you have made, your general liability most likely will not provide coverage. It generally takes a claim of bodily injury or property damage to trigger coverage under a general liability policy. With professional liability, claims of economic loss can be a trigger of coverage and many policy forms have broad duty to defend language even if the allegations against you are groundless or false.
Professional liability insurance is also referred to as Errors & Omissions (E&O) or malpractice insurance. Professional liability is an important coverage if you want to defend you business from allegations of professional negligence or lawsuits alleging errors or omissions in the course of providing professional services.
Professional Liability Examples
There are countless reasons why a customer may bring a lawsuit against your business.
- An error on your end results in a late delivery, and lost sales for your client.
- The financial advice you gave a client resulted in a devastating economic loss.
- A customer felt your work didn’t meet their standards.
- You missed a deadline.
- Your client felt you didn’t act in their best interest.
- You installed a product and did not follow the manufacturer’s directions resulting in the failure of the product.
If you provide a professional service, advice, or consulting to clients, your business is at risk for a lawsuit anytime a mistake or error occurs. You may even face a lawsuit for not providing a service to a client if they feel your inaction led to their financial loss. Professional liability helps cover the gap found in most general liability policies by providing defense and indemnity when a claim results from alleged professional negligence.
Is Professional Liability Right for Your Business?
Here are a few examples of the types of professionals and professional firms that should consider purchasing professional liability:
Service professionals such as:
- Interior designers
- Insurance agents
- Tax preparers
- Graphic artists
- Web designers
- Personal trainers
- Real estate agents
Professional firms such as:
- Product manufacturers
- Contractor firms
- Design build firms
- Environmental firms
- Property management firms
- Publishering firms
- Advertising firms
The types of business that need professional liability protection are endless and the need for this type of coverage exists in nearly every type of industry.
Beach & O’Neill Insurance Associates writes professional liability across a wide cross section of industries. We work with dozens of specialized carriers and can find coverage for any kind of professional exposure. Please contact us if you are interested in professional liability and we will tell you if this coverage is right for you. Errors, mistakes, and oversights happen; professional liability can be the difference between an error becoming a small learning lesson, or an extremely costly mistake.