Professional Liability Insurance 101

Professional Liability Insurance 101 – Part 1

Professional Liability Insurance – Common Questions & Answers

The following information regarding “professional liability insurance” is offered as general information, it is not intended nor will it replace a comprehensive understanding of ones own coverage or supersede the specific language of any policy. Also remember that Professional Liability Insurance policies are not standard, each one differs. The actual terms and definitions introduced here can be different from what exactly is contained in a specific policy. Be sure to contact a licensed professional liability insurance agent for specific details pertaining to your state.

This article on professional liability insurance will be covered in two parts, this is part one.

Exactly what does Professional Liability Insurance cover?

Professional Liability Insurance protects for errors and omissions committed by you, your partners or your employees in the course of their professional duties where you become or could become legally liable. For example it would cover missed filing deadlines; professional liability insurance may address areas like medical, legal or accounting procedures/engagements that the outcome was less than what was expected; or errors made in interpreting the law or applying a statute.

With few exceptions, the majority of commercial and business owners policies exclude coverage for professional acts. No matter how careful mistakes (either actual or perceived) do happen.

So what does Professional Liability Insurance not cover?

It does not cover slips and falls in an office, destroyed property, advertising injury, or other types of general liability claims. Sometimes you’ll find add-on endorsements to provide some additional coverage for these incidents however these are best covered by your general liability or business-owners policy.

It also does not cover employment practices claims against you, such as wrongful termination, wrongful dismissal or sexual harassment charges.

Why you should purchase Professional Liability Insurance?

Malpractice claims frequency have a tendency to increase when the economy is not doing well. The number of errors or problems do not increase but more business deals go bad and people are generally looking for ways to become whole again. The problems were already there, but in a declining economy more of the problems emerged. One of the more important insurance benefits is having the insurance carrier pick up the defense costs and find outside counsel to represent you. Many carriers have claim “Hot Lines” to let you discuss an incident prior to it becoming a claim. And if a claim is filed insurance carriers have pre-selected lawyers that specializes in handling malpractice claims in order to represent you and if nothing else provide you with piece of mind that when a problem occurs you are not all alone.

Get additional information on Professional Liability Insurance @ Monument Commercial Insurance Agency. We will also be publishing a part two to this article within the next few days, so keep watch. And thanks for reading.

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