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Professional Liability Insurance is a type of business insurance, typically for organizations that provide consultation or any professional services to its clients. Even if you’re an expert in your business, mistakes happen. And if your client or customer thinks a mistake in your professional services caused a financial loss, they can sue you. Professional liability insurance helps cover you and your company if you make a mistake in your professional services. This coverage is also known as errors and omissions insurance (E&O) or in some countries as professional indemnity insurance. .
Most organizations decide to take up professional indemnity insurance keeping in mind their own protection against coughing up a large sum of money, in case they have caused their clients a huge loss due to their own mistakes and have to compensate for that amount. It does not matter if you share a good business relationship or bond with your clients. A mistake that may lead to a financial loss will disrupt the peace between you. Therefore, it is very important to take up professional indemnity insurance for protection.
The Professional Liability Insurance works on the concept of protecting professionals and businesses against any claims initiated by their clients with respect to the professional services or consultations offered. The claims may arise due to negligence, errors, malpractice, etc. in offering professional advice or services to your clients resulting in a substantial financial loss. However, professional indemnity insurance mostly covers the claims related to incidents that occurred during the policy period. Professional indemnity cover is provided majorly on claims made basis. It indemnifies the professional liability of the insured for only the claims made during the policy period on account of covered malpractices, negligence, errors & omissions, violation of good faith or misrepresentations committed within the same policy term. Any claims filed for an incident occurred before the activation of the policy coverage may not be covered by the insurance company.
You’ll want to get a Professional Liability Insurance policy if you:
Your Professional Liability Insurance cost is unique to your business. Factors that can impact your errors and omissions insurance cost include:
When you’re ready to get a quote, it’s a good idea to have important business documents on hand, such as:
Work with our specialists to get the right amount of coverage for your business at the right price.