Professional Liability Insurance
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What is professional liability insurance?
Professional liability insurance protects you if you are sued because you provide bad advice while on the job or make a mistake while providing work related services.
Professional liability insurance vs. malpractice vs. errors & omissions (E&O)
Professional liability insurance covers you if you’re sued because of bad professional advice or make mistakes while providing work related services.
Malpractice insurance is a form of professional liability insurance purchased by doctors, other healthcare, and legal professionals.
Errors and omissions, or E&O insurance, is another name for professional liability insurance purchased by agents, engineers, consultants, and other professionals in finance, real estate, insurance, and IT industries. It covers your business if your business is sued because it provided incomplete on inaccurate information to a customer or client and they sue you. It also covers advertising related errors.
What does professional liability insurance cover?
Professional liability insurance covers you if your business is sued because you or someone who works for you is sued because you provide incorrect advice to a client or customer or they find your professional services inadequate.
Who needs professional liability insurance?
Professional liability insurance is typically purchased by doctors, lawyers, and accountants who can make very costly professional mistakes. It is also worthwhile for marketing firms, florists, hairstylists, and others who could make errors that could result in large enough lawsuits that could force them to close down.
Below are some popular professionals that need professional liability insurance coverage:
- Teachers: the best professional liability insurance companies for teachers
- Federal employees: the best professional liability insurance companies for federal employees
- Private investigators: the best professional liability insurance companies for private investigators
- Architects and engineers: the best professional liability insurance companies for architects and engineers
- Lawyers: the best professional liability insurance companies for lawyers
- Accountants and CPAs: the best professional liability insurance companies for accountants and CPAs
How much does professional liability insurance cost?
Perhaps more than any other type of insurance, professional liability insurance can vary dramatically. It is based on many factors including company industry, size, years of experience, and location.
Professional liability insurance cost can range from a few hundred dollars a year, for an insurance agent or and accountant, to many thousand a year, for a lawyer or a dentist or a family doctor, or even hundreds of thousands dollars a year, for a surgeon or an OB/GYN doctor.
Recent professional liability lawsuits
Professional lawsuits are seldom covered in the news because they do not rise to a level that people care about them. Three examples of professional liability lawsuits include:
- A lawsuit against a doctor in Janesville, Wisconsin, who pierced a patent’s esophagus during a medical exam
- A Syracuse nursing home that was sued over a patent’s hanging, blaming it for providing her with too little attention; and
- A nurse anesthetist who lost two patients while working for an Arizona dental practice.
Top 3 states where most small businesses are looking for professional liability insurance coverage
Claims-made vs Occurrence professional liability insurance
Claims-made is usually less expensive, but it’s also less comprehensive because it only covers you for mistakes you make while the policy is active.
Occurrence based insurance covers you for any claims that occurred while the policy was active, regardless of whatever date the claim was filed.
For example, you have claims-made insurance as a doctor. You have this insurance from Jan 1, 2020 to Jan 1, 2021. If you client files suit sometime between those dates, you’ll be covered. If this person thinks about things for a while and doesn’t file suit until March 15, 2021, you will not be covered under claims-made insurance, but you would be covered under occurrence based policy because you had insurance when the mistake occurred.
Why buy professional liability insurance from BravoPolicy?
Great question! Here are three good reasons:
- You’ll probably pay less for your professional liability insurance with BravoPolicy. Our customers save 20% on average.
- We can get your small business covered in about 10-15 minutes.
- You can manage all of your business insurance needs through our online portal. No paperwork needed. No need to wait on the phone for hours to speak to customer service.
Professional liability insurance FAQs
It could be smart for you to get it if you and the people who work for you provide advice to clients or customers and offer them services.
If you or someone who works for you makes a mistake or provides bad advice while on the job, you could be sued for it. Paying for legal help and settlement expenses could cost you hundreds of thousands or even millions of dollars. This is a risk you probably don’t want to take.
Yes, it will even cover you if you’re involved in a frivolous lawsuit.
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