Professional Liability (Errors & Omissions) Insurance

Embroker helps business owners get the right professional liability insurance to properly protect your business from civil lawsuits for negligence, common mistakes, malpractice, misrepresentation claims, and more.

GET A QUOTE

What Is Professional Liability Insurance?

Professional liability insurance is commonly known as errors and omissions (E&O), professional indemnity, or malpractice insurance. They all refer to insurance that keeps you and your company protected from civil lawsuits for negligence, common mistakes, omissions, misrepresentation claims, and more.

Professional liability insurance is typically the first policy purchased by anyone providing professional services (lawyers, accountants, consultants, etc.) as they realize these claims can be among the most expensive.

If you already have general liability insurance, you may think that you don’t need professional liability coverage. However, many liability policies only cover bodily injury, personal injury or property damage, so the most likely of claims (i.e. those related to your services) do not fall under the GL umbrella.

For example, professional liability can cover you if a customer chooses to file a claim against you related to a service that you either failed to provide entirely or sufficiently. To clarify, if a service you performed did not have the expected or reasonable results in the eyes of your client, you could be sued.

In the medical and healthcare industry, when talking about doctors, chiropractors, dentists, and nurses, this type of insurance is often called malpractice insurance.

A good professional liability policy will be able to cover all of the costs of your defense, as well as your judgments or settlements.

Who Is Professional Liability Insurance Coverage For?

Professional liability insurance is particularly useful for any business that offers professional services, such as lawyers, accountants, consultants, investment advisors, real estate agents, architects, medical experts, engineers, tech companies, and others.

These professions require specialized education or training, and their practice must meet certain state, industry, contract, or client standards. Oftentimes, the professional is licensed for their trade. Compromised standards or not living up to the standard of care can lead to expensive legal defense costs or even litigation which will put your company assets at risk and can even endanger your personal assets.

Really, any small business or large corporation that is providing a service to a client for a fee should look into E&O coverage, whether you’re a dentist, a beautician, or a wedding planner.

Ask yourself:

  • What is the material impact my services have on my clients and what if I make a mistake or upset a client?
  • Are my clients ever at risk of monetary damages if I make a mistake or give bad advice?
  • Is there a lot of variation in the services I provide from person to person?
  • Do I ever make suggestions or claims that could be construed incorrectly?

If you’re answering “yes” to these questions, you should have a professional liability policy.

Why Do You Need Errors & Omissions Insurance?

No matter how good you are at doing your job and how long you have been doing it, you are bound to make a mistake every now and then or have a disgruntled client. E&O coverage protects you in the case that you do make a mistake that a customer decides to sue you over.

For example, if your client in Springfield, Massachusetts needed important products shipped to him for the grand opening of his store, but your company shipped them to Springfield, Illinois instead, you can expect a lawsuit from that customer.

In some instances, E&O claims aren’t even related to money. A claim can be made for less tangible issues, such as loss of reputation or emotional distress.

Sign Up in Under 10 Minutes.

Get Your Instant Quote

“Fantastic rates on Professional Liability insurance. Personal service, friendly, efficient, rapid!”

Jason Burnett

Reed Longyear Malnati & Ahrens

Don’t Just Take Our Word for It!

With a Net Promoter Score (NPS) of 70+ Embroker is the highest rated business insurance company in the market.

NPS Score 2020

17
Insurance Industry
71
Embroker

Related Articles.