What Is Professional Liability Insurance—and Who Really Needs It?

Regardless of your experience level or attention to detail, accidents and mistakes are, unfortunately, inevitable. Laying the groundwork to be able to manage resulting losses can make all the difference in maintaining financial stability and protecting your business’s good name. With this in mind, professional liability insurance should be considered a crucial investment and essential component of your commercial insurance package.

What Is Professional Liability Insurance?

Professional liability insurance may also be referred to as errors and omissions (E&O) insurance. Additionally, certain industries may have their own terminology, such as medical malpractice insurance in the health care sector. Regardless, these policies generally serve the same purpose of providing coverage against legal costs and damages if a client, customer or other party alleges that your services were inadequate and caused their losses.

Who Needs Coverage?

Many types of professionals and businesses can benefit greatly from retaining a suitable professional liability insurance policy. Essentially, if you provide services, advice or guidance to other parties as part of business arrangements, you should highly prioritize retaining coverage. Specifically, those in the following lines of work may benefit:

• Consultants and advisors
• Accountants and financial planners
• Real estate agents and brokers
• Architects and engineers
• Health care providers
• IT professionals and software developers

In some cases, professional liability insurance may be legally required by state laws to operate in certain industries. Additionally, many clients may refrain from doing business with you unless you’re adequately insured.

What Can My Policy Cover?

In response to allegations or accusations of improper services, your professional liability insurance may help fund resulting costs and losses. This may include hiring attorneys, enlisting expert witnesses and paying settlements and judgments. While exact parameters may vary, many policies can provide aid in response to being accused of the following:

• Professional errors
• Inaccurate advice
• Missed deadlines
• Negligence
• Oversights
• Omissions
• Breaches of contract

We’re Here to Help

If you’re looking for professional liability coverage in or around Murray, UT, the team at Statewide Insurance Agency is well-equipped to help. Contact us today to discuss your coverage needs and available options.

This blog is intended for informational and educational use only. It is not exhaustive and should not be construed as legal advice. Please contact your insurance professional for further information.