Professional liability insurance

No human – or small business – is perfect. This means all are at risk of being sued when they make a mistake or fail to do something important. Professional liability insurance is a safety net for your business mistakes, such as failure to deliver the work product your clients expected and for which they paid.

Professional liability insurance covers your legal expenses in cases where a customer alleges your work was:

• Professionally negligent
• Shoddy or flawed 
• Incomplete

In addition, professional liability insurance can protect you when clients claim you engaged in misrepresentation or violated principles of good faith or fair dealing. 

When your mistake or omission lands you in court, your professional liability insurance will pay for your:

• Attorney fees
• Settlements (money paid to the plaintiff to drop the lawsuit)
• Judgments (money a judge or jury orders you to pay the aggrieved party)
• Expert witness fees
• Court administrative costs

Professional liability insurance does not cover:

• Bodily injuries
• Property damage
• Deliberate wrongful acts
• Violations of law
• False advertising claims
• Employment discrimination

Professional liability insurance is designed for businesses that sell their expertise, such as architects, engineers, accountants, IT consultants, and software developers.

Medical professionals such as doctors, nurses, and home health aides need professional liability insurance, too. But their form of coverage is better known as malpractice insurance.

Small businesses that rely on selling their professional expertise (think lawyers, accountants, and engineers) can usually find professional liability insurance as long as:

• Their business model isn’t overly risky.
• They haven’t filed an excessive number of professional liability insurance claims.

Assuming your firm can meet an insurance company’s underwriting requirements, you will likely be able to qualify for this important form of small business insurance protection.

Insureon helps small business owners compare commercial insurance quotes from A-rated U.S. carriers with one easy online application. Start a quote today to protect your business against claims of professional negligence.