Professional Liability Insurance

Professional Liability Insurance

Professional liability insurance is the same insurance product as errors and omissions (E&O) and medical malpractice. These terms are interchangeable and each is more common in separate business segments. For business owners such as Real Estate Agents, Mortgage Brokers, and Home Inspectors, professional liability is more common terminology. Types of businesses, such as insurance agencies, Law firms and Accounting Firms often refer to errors and omissions insurance. Within the Medical Profession, malpractice insurance is used instead of professional liability.

Professional liability insurance protects business owners who give advice.

What is Professional Liability Insurance?

Professional liability insurance is insurance coverage for professional businesses that give expert advice or provide technical services for a fee. It is designed to help protect a business against any claims of negligence. Therefore, professional liability insurance helps business owners defend themselves from lawsuits and also helps pay damages awarded to customers in a civil lawsuit. The main function of professional liability is to ensure that consumers have a legal recourse for mistakes made by professionals and to enable professionals to defend and pay damages if they are responsible.
The most common claims that business professionals face under their professional liability insurance policies include a) inaccurate advice, b) misrepresentation, c) negligence, and d) claims against fair dealing and good faith practices.

Key Elements of Professional Liability:
  • Failure to perform as agreed by the professional business person.
  • Financial losses caused by an act or the advice of a professional.
  • Errors in the product or service sold by the business professional.
  • Professional liability is not a replacement for general liability insurance. Not every business needs professional liability coverage. This type of insurance does not provide coverage for bodily injury or property damage. Those companies requiring professional liability will also need a separate GL policy, or GL coverage endorsed onto their professional liability policy. Contact a licensed agency, such as General Liability Shop.com, to find out if your business needs professional liability insurance.

    E&O and Professional Liability

    E&O and professional liability insurance are more commonly written on a claims made basis as opposed to an occurrence basis. This generally means that any claims must be filed while the policy is active and covering the period in which the cause of the claim was created. Insureds purchasing a claims made policy are advised to thoroughly understand claims made coverage.

    Professional liability insurance is the same form of coverage as E&O insurance.

    Errors and omissions coverage may specifically exclude negligent acts other than mistakes. This exclusion makes an important distinction between willfulness and accidental. While an honest mistake can happen and cause financial harm within any professional business, errors and omissions policies may have stricter definitions within their contractual language.

    Professional Liability Insurance Quotes

    Professional liability insurance is one type of insurance most professionals won’t do without. Therefore, for most business owners, it’s not a matter of whether or not to purchase professional liability coverage, it’s a matter of cost versus value. The unfortunate reality of today’s world is that people are more litigious than ever before. Professional liability has become an important safety net for most professional businesses.

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    General Liability Shop.com offers professional liability quotes from more than 15 insurance companies. So why shop your professional liability insurance with multiple agents when you can shop multiple insurance companies with one national agency? Give us a call today to find out if your business qualifies for one of our select professional liability programs. Or get your quote started online.

    Business professionals who need professional liability insurance often get a more insurance coverage and better protection by adding a commercial umbrella policy.

    Learn more about Umbrella Coverage.

    How Much Does Professional Liability Insurance Cost?

    Professional liability insurance ranges in price depending on factors such as the nature of the business, location, gross revenue and the limits of coverage desired. Our average small business professional liability customer spends between $1,000 and $1,500 per year on their PL coverage. Our larger agency customers (over $1 million in revenue) average $4,000 to $7,500 per year for professional liability.

    Professional liability insurance costs less than most business professionals think.

    Our Top Carrier Solutions for Professional Liability
  • Axiom
  • Philadelphia
  • CNA
  • Scottsdale
  • Gateway
  • Starr BOP
  • Guard
  • The Hartford
  • Markel
  • Travelers
  • MetLife
  • USLI