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Commercial Professional Liability Insurance

Professional Liability Insurance (also known as Errors and Omissions insurance) helps protect you and your business if you make a mistake in the professional services you provide. Mistakes happen, even if you are an expert in your field. If your client or customer thinks you made a mistake in your professional services, even if you didn’t do anything wrong, your client can sue your business. Your policy can protect you from having to pay expensive legal fees out of your pocket from claims of negligence, misrepresentation, inaccurate advice, and personal injury.

If your business faces errors and omissions(E&O) claims or lawsuits, your E&O coverage can help pay for:

Damages, including any judgments and settlements that result from the lawsuit.
Legal defense costs, which can include attorney fees and other court-related expenses.
Disciplinary proceedings called by a regulatory, licensing or other government agency.
Loss of earnings as a result of the time you spend at depositions and trials.
Subpoena assistance if you’re a witness in a lawsuit.

Professional liability insurance doesn’t cover every kind of claim. It won’t help your business with claims of:

Bodily injury or property damage: a general liability insurance policy can help cover claims that your business hurt somebody or damaged their property.
Work-related injuries or illnesses: If your employees get hurt or sick from their job, you’ll need a workers’ compensation insurance policy.
If your business has a data breach or ransom situation cyber insurance can help cover these claims.

Examples of How Professional Liability Insurance Can Help Your Business:

A bookkeeper makes a clerical error that costs their client thousands of dollars.
A web developer makes a mistake on a client’s e-commerce site, resulting in missed sales opportunities.
An accountant files an incorrect tax return for their client, resulting in a penalty fee.
A client sues your florist shop for errors in the services you provided after you failed to deliver flowers on time for their wedding.
Your real estate firm recently sold a townhouse to a couple that was planning on starting a daycare. However, when the couple moved in, the townhouse association informed them they couldn’t use the property for a business. The new owners decide to sue you for negligence.

Contact us today for your Professional Liability (E&O) Insurance needs.

Businesses face risks every day and lawsuits come from any direction. We are your trusted advisor to help you foresee risks and design options for you to choose the ideal coverage for you and your business to be protected.

Types of Professional Liability Insurance

There are two types of professional liability insurance policies, Occurrence Basis and Claims-Made Basis.

Occurrence Basis

Coverage for losses that happen during your policy period, even if the claim gets reported after your policy expires.

Claims-Made Basis with Retroactive Date and Extended Reporting Period

Retroactive date means you’re covered for incidents that happen on or after a specified date in your policy.
Extended reporting period helps cover claims filed within a certain time after your policy expires. This is generally a 30- to 60-day period, but you can extend this period to a year or more for an additional cost.

A claim must be from a covered error or omission that happened after your policy’s retroactive date. It can help cover:

Damages
Legal defense costs
Disciplinary proceedings
Loss of earnings
Subpoena assistance

Protect You and Your Company Now

When you’re ready to get a quote, the types of business documents you will need on hand to discuss with your insurance agent are:

Copies of contracts
Documentation procedures
Any information about previous errors and omissions in coverage
Quality control processes
Employee training initiatives

FAQs

Is Professional Liability Insurance required by law?

Certain businesses are required to carry professional liability insurance in some states. For instance, healthcare professionals need medical malpractice insurance, which is a type of professional liability.

You might have to carry professional liability coverage if your clients require it when you sign a contract. Regardless of whether you’re required to have it by law.

Some examples of businesses that should carry professional liability insurance include:

Lawyers or law firms
Consultants or professionals
Accountants or tax preparers
Home inspectors
Technology professionals

What businesses can benefit most from Errors and Omissions Insurance?

Technology professionals, because tech failures can be devastating to your client’s finances. Software, hardware and electronic manufacturing businesses are at a high risk for errors or omissions lawsuits.
Management and business consultantswho provide advice can get sued by unsatisfied clients.
Tax preparers, because mistakes or lapses in judgment can cost their clients money.
Accountants, because they give a wide range of financial advice, so their mistakes can have big financial impacts.
Advertising agencies, since they can get sued if an ad or campaign results in a financial loss for their client.
Graphic designerswho create ads, brochures, magazines, corporate reports and more for their clients with mistakes that can be expensive.
Interior decorators, because clients who are unhappy with their advice and decorating services can file lawsuits.
Real estate agents, since they can get sued if agents misrepresent a property.
Travel agents, since a mistake can ruin a client’s vacation plans and lead to a lawsuit.