What is professional liability Insurance?

Professional liability insurance, commonly referd to as Errors and Omissions Insurance (E & O Insurance), insures a person and/or entity against claims made by third parties (clients, cusomers, etc.), alleging negligence in the rendering of, or the failure to render, professional services.

Exactly what constitutes negligence is difficult to define. Loosely defined, negligence refers to the failure to provide the degree of knowledge, care or skill of the average professional peer in good standing, under specified circumstances. Essentially, any person or any business that claims to be an expert in a particular field can be held responsible for work, advice or counsel within that field.

Why do I need it?

At any time, in any given situation, an unsatisfied individual can choose to bring a complaint against you. When people file lawsuit, they usually name everyone they perceive as having caused the situation - including you and your business.

As a general rule, claimants sue as many individuals as possible. Regardless of who is negligent, it can take years for litigation to be dismissed. While you may be exonerated from liability, your attorney's fees can be staggering. Professional liability insurance helps relieve you from the financial burden of defending yourself in a lawsuit.

In addition, it's important to note that having professional liability insurance does not make you any more likely to be sued than if you did not carry coverage. It simply makes you more prepared if a lawsuit is brought against you.

Who exactly does professional liability insurance cover?

Although formalizing a contract with your clients can help limit the liability, the big expense in a professional liability claim is the legal defense needed to prove liability or innocence.

Professional liability policies are designed to cover many of these defense costs and ultimately the final judgment if the business owner does not win the case.

What is general liability insurance?

Insurance protecting a business from most liability exposures other than professional liability and commercial automobiles.

Why do I need general liability insurance?

General liability insurance provides protection against liability claims for bodily injury (BI) and property damage (PD) arising out of premises, operations, advertising and personal injury (PI) liability.

Still have more questions

Use our contact page and one of our account administrators will contact you shortly to answer any outstanding questions you may have.