Why You Need Professional Liability Coverage in Your Business Insurance
If customers file a complaint against you for harm done to their business after following your professional advice, will your insurance cover this claim? Business insurance policies almost always include general liability, but it might not be able to address this particular claim. What you need is professional liability coverage.
What Is Professional Liability Insurance?
In a nutshell, this type of coverage encompasses damages filed against a business entity for a professional or personal service it provided. Where general liability insurance covers personal injury and property damage, professional liability covers claims such as financial losses, loss of business, and business interruption.
Also known as errors & omissions (E&O), a professional liability policy shoulders damages from a lawsuit filed by a client regardless of who was at fault. In other words, professional liability insurance pays for your defense cost. And in the event that the court orders you to pay for damages awarded to the plaintiff, this policy can provide coverage as well.
What Claims Are Covered by the Policy?
The following are some of the claims commonly stipulated in a professional liability policy:
- Violation of fair dealing
- Breach of trust/good faith
- Inaccurate professional advice
What Types of Professions Are Generally Covered?
Generally, anyone running a consultancy firm or a service-oriented business is a good candidate for the policy. But just to give you an idea, some of the professions covered include the following:
- Trainers and Coaches
- Mental Health Therapists
- Family Health Counselors
- Business/IT/Management Consultants
- Occupational Therapists
If you are unsure of whether or not your business or profession can be covered by professional liability insurance, your best option is to confer with a professional insurance specialist. For inquiries, or if you want to get a free quote for this type of business insurance policy, call Breathe Easy Insurance at 866.822.7755.