Professional liability insurance

Professional liability insurance

What is insurance for professional liability?

Business professionals including accountants, consultants, and attorneys are covered by professional liability insurance against allegations of carelessness or misconduct pertaining to the services they render. Errors and omissions (E&O) insurance is a common name for it.

Experts who offer advice typically need professional liability insurance since mistakes made as a result of their services could cost their clients money or cause indirect loss. Other commercial insurance coverages often do not cover these kinds of occurrences.

What is protected by professional liability insurance?

Claims of actual or alleged carelessness resulting from rendering professional services, such as giving inaccurate advice, omitting something, or failing to execute a service, are covered by professional liability insurance. This coverage applies whether or not a mistake was made and covers damages and defence expenses up to your policy limits.

For instance, a client alleges that an accountant filed their taxes wrongly, resulting in significant financial loss. The costs of the lawsuit and settlement may be partially covered by the accountant’s professional liability insurance.

Many professional liability insurance policies are claims-made policies, which means that only claims made during the policy term are covered. Incidents that take place before a policy’s effective date may be covered by adding a retroactive date.

Protection from professional liability lawsuits is available for work done everywhere in the world and for services rendered in the past.

Who is eligible for professional liability coverage?

Any company that offers professional services or advice should think about purchasing professional liability insurance to guard against litigation brought about by their errors.

Certain professionals, like lawyers, must possess it legally before they can conduct business in some states. Clients may stipulate in their business contracts that a company maintain a specific level of professional liability.

Professional liability insurance is necessary for a range of business professionals, including:

• Consultants
• Attorneys
• Engineers
• Architects
• Real estate agents
• Insurance agents
• Accountants
• Home inspectors

Frequently asked questions regarding professional liability insurance