Professional Liability....A.K.A. Errors and Omission Coverage

What is Professional Liability ? Why do you need it?

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By definition-Professional liability insurance is a type of business insurance that provides coverage for professionals and businesses to protect against claims of negligence from clients or customers.

Running a business is oftentimes complex, stressful, and predictably unpredictable. Have you ever heard the phrase "I wear a lot of different hats" from a business owner? Business insurance is actually very similar. Think of the different policies and coverage options as different hats, such as, General Liability, Employment Practices Liability, Commercial Auto liability, Workers Comp, Inland Marine, Umbrella, Business Income, Cyber(Data Breach), Commercial Property, Directors/Officers and Professional or Errors & Omission Liability. Today, lets talk about Professional Liability

Who needs it?

Some industry experts say that if you render an opinion or professional advice in return for a fee, you need Professional Liability. Here are some professions that should carry Professional Liability coverage:

• Accountants

• Architects

• Consultants- including management, IT firms,

• Engineers

• Financial Advisors and Investment Advisors

• Insurance and Real Estate agents/brokers

• Software Developers

• Doctors and Lawyers(most commonly referred to as Malpractice)

What does it cover?

A simple explanation is the financial loss incurred because of

• Negligence

• Errors &/or Omissions

• Copyright Infringement

• Personal Injury

• Undelivered Services

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What it doesn't cover

• Injuries

• Property Damage

• Discrimination

• Abuse

• Lawsuits you initiate

• Claims made after policy expires

• Criminal

• Possibly more depending on carrier restrictions

How to reduce your professional liability

Use Contracts- Make sure your contracts are clearly defined. You may want an attorney to draw your contracts up for you.

Get Everything in writing- Be sure to document communications with your clients. Even if you speak over the phone, take notes and send a follow-up email or notate your client management system.

Keep all parties up to date- communicate the progress and potential obstacles so clients are not surprised by an outcome. Remember, transparency builds trust and deters lawsuits.

If you have questions about Professional Liability, also known as Errors and Omission, reach out to our office. www.insure-logic.com