Professional Liability Insurance
Professional liability insurance, also called errors and omissions aka -E&N, is designed to protect you and a must for all professionals. Regardless of your business type, industry, and size, dealing with legal fees and settlements can end up being costly. Defending yourself in court demands an astronomical amount of money. Sometimes damages are awarded without any wrongdoing on your part. Having an errors and omissions policy can cushion you against such costs.
You should consider this type of insurance if you provide guidance and advice, provide professional services or consider getting into a client contract. It protects against financial damages or mistakes, causing a financial loss to your client.
Professionals commonly targeted with such claims include medical practitioners, lawyers, consultants, designers, among others. They provide professional advice to their clients. The possibility of making a mistake is very high, and you might have a client making a claim.
How much does professional liability insurance cover cost?
General professional liability insurance for a small business will depend on the location, size of business, industry, sales, and experiences.
What does professional liability insurance cover?
It protects you against some of the common mistakes of doing business. It includes
- Wrong/inaccurate advice
- Loss of documentation
- Unintentional defamation
- Not meeting clients expectations
- Missing a deadline
Even with no intention to cause harm, an allegation is enough to cost you financial loss. In the process of clearing your name, you end up spending money on legal fees.
Malpractice insurance – for medical professionals to protect against claims or loss due to negligence or mistakes.
Errors and Omissions insurance- protects you from giving bad advice to a client leading to financial loss.
Professional liability protects you from
- Legal and defense costs
- Damages or settlements awarded to your client
- Claims investigation costs.
- Defends your reputation
What is not covered?
Professional liability insurance will not cover;
- Bodily injury
- property damage
- Work-related injuries or illness
- Fraudulent acts
- False advertising
- Cyber breach
- Patents and trade secrets