Every day, your clients or patients rely on your advice and expertise. Should you make a mistake while providing advice or performing a procedure and that error results in damages or a financial loss, you can be held liable and may be sued.
Professional Liability Insurance provides coverage for individuals and businesses offering professional services. If you work in an industry that provides services or advice to individuals based on your specific credentials—such as your education, experience or professional designation—then you should have Professional Liability Insurance.
Also known as Errors and Omissions Insurance, this policy covers damages that are not insured by a General Liability Insurance policy. General Liability covers physical risks—like bodily injury or property damage—but it does not cover claims arising from professional services. However, General Liability does not cover bodily injury as a result of services performed directly on a person such as injury sustained while undergoing surgery or getting hair cut.
Contrarily, Professional Liability Insurance picks up these "gaps" in a general liability policy in order to cover risks related to errors and omissions in the services you or your business provide. This can include those financial losses that do not result in bodily injury or property damage such as costs related to project delays, losses of income or costs to re-design or re-build something where there was a design error. In case of malpractice, professional liability can pick up costs related to claims of negligence due to injuries sustained while undergoing a procedure such as cutting hair, tattooing or laser aesthetics.
Professional Liability Insurance policies will vary based on your industry and needs. At Krywolt Insurance, we customize your Errors and Omissions Insurance coverage for the specific requirements of your business.
Professional Liability Insurance is a must if you or your company provides a service which includes physical contact with your customer or if you provide advice to your clients. If your company is sued, your Krywolt Professional Liability Insurance may include some or all of the following:
Errors and Omissions Insurance coverage is strongly recommended to protect your business from claims alleging negligence from your professional services. These claims may include:
Your Errors and Omissions Liability Insurance will cover the costs associated with lawyers to defend you—even if the lawsuit is groundless. Unfortunately, even if the suit against you holds no weight in court, legal proceedings are expensive and you or your company could incur a serious financial loss undergoing legal proceedings. A Professional Liability Insurance policy will help cover you from this financial deficit.
Legal costs that may be covered by your Errors and Omissions Liability Insurance could include:
Your Errors and Omissions Liability Insurance policy may even cover supplemental expenses you incur as a result of attending an arbitration proceeding trial in the defense of a covered claim.
Errors and Omissions Liability Insurance may protect you against personal injury claims that arise while rendering your professional services. For example, your policy may protect you from alleged defamation including:
Error and Omissions Liability Insurance may also protect against copyright infringement. This coverage is particularly helpful for individuals working in the fields of media, marketing or technology. Should an individual or a company wrongfully use the work of another person, this can infringe on the copyright of that work.
For example, if a magazine uses the work of a photographer without permission this infringes on the copyright of the photo. Likewise, selling/distributing or posting work online without the owner’s permission could result in a suit.
At Krywolt Insurance, we believe your insurance should follow you wherever your business takes you. Perhaps you work as a consultant and your expertise is hired by companies across the globe. Or, maybe you’re a freelancer with multiple clients all over the world. It’s best practice to have all your bases covered and ensure your Professional Liability Insurance policy covers you no matter where you are providing your professional services.
As a business owner, you hire employees to provide the professional services offered by your company. Krywolt covers claims arising from business-related services completed by your employees, temporary staff and independent contractors*. While you may not be personally at fault for a claim of negligence or error, one of your staff members may have made a mistake. This mistake could be the responsibility of your company. *It should be noted that an independent contractor will need their own insurance to cover their exposure. While your company is covered the independent contractor will not be included in the coverage definition under your policy.
For instance, an architecture firm may have a number of senior, mid-level and junior architects, project managers and administrative staff in its employ. It may also hire independent construction and interior design contractors to help out with a job, and may need to hire temporary architects or administrative staff if a full-time employee is on leave. If a mistake was made during construction—like delays in construction or faulty cost estimates—the responsibility is on the firm, not the contractors or employees.
Did you know there is no statute of limitations for claims, permitting there is new information that has just come to light? For instance, a construction company may have renovated a roof four years ago. However, if it only comes to light now that the wood used was not treated and has resulted in rot that requires additional repair costs, the construction company could face legal trouble.
If you’ve been practicing as a professional service provider for a long time, then you may have made a mistake in the past that may not be realized until weeks, months or years down the road. It’s better to be on the safe side with an Error and Omissions Liability Insurance policy.
If you lose a large claim, it can affect the financial stability of your business. Rather than have to face the potentially devastating financial impact of losing a negligent, error or omission claim against you, your Krywolt policy can cover claims for monetary damages and non-monetary relief.
It’s better to be safe than sorry. Avoid having your consulting agency, law firm or tattoo shop crippled because you lost a claim against you.
With Krywolt Insurance in your corner, you don’t have to worry about incurring losses from a suit against you due to error, negligence or omission. Our insurance companies will look to defend you and, if necessary, appoint a lawyer to handle your claim. Additionally, a Professional Liability Insurance policy can cover any damages you may incur (up to the policy limit).
Get a fast, free quote now or call us at 403-475-5434 to get started today—and feel confident knowing Krywolt Insurance is behind your business.
You need to have Professional Liability Insurance if you:
For example, some industries that should consider having Professional Liability Insurance include:
A professional liability carrier is an insurance company licensed to sell professional liability insurance. Typically, a professional liability carrier is not licensed to discuss and conduct business directly with the public. However, they have contracts with multiple insurance brokers who complete applications and review coverage needs that are submitted to the carrier for review.
The professional liability carrier would then decide whether or not to provide insurance based on the information provided. The professional liability carrier also decides the cost of insurance and sets the terms and conditions.
No, Professional Liability Insurance is not the same as General Liability Insurance. However, the two policies can work together to cover different risks.
General Liability Insurance is meant to cover bodily injury and property damage as a result of your operations. General Liability excludes claims arising from professional services—this is called the "professional services exclusion."
Contrarily, a Professional Liability policy will not cover bodily injury or property damage except in the case of injury during a procedure. The policy typically extends to all other financial losses related to the rendering of a professional service.
Professional Liability Insurance may have any number of specific exclusions included in its wording. Typically, a Professional Liability policy will not cover losses related to property damage or bodily injury—unless those damages result directly from the failure or error in rendering a professional service.
An example of a claim not covered by a Professional Liability Insurance policy would be bodily injury due to a slip and fall in a doctor’s office. However, bodily injury sustained because of a doctor making a mistake during a surgery would be covered under a Professional Liability Insurance policy.
Professional Liability Insurance, Errors and Omission Liability Insurance and Malpractice Insurance all refer to the same type of insurance. Each term describes insurance meant to cover financial losses incurred by a client or patient as a result of:
These different terms for Professional Liability Insurance can be interchanged and often are used to indicate different industries. For example, insurance professionals may use:
The best Professional Liability Insurance is a policy that covers operations specifically related to your service and/or business. In fact, the operations disclosed on a Professional Liability Insurance application will directly affect how the policy will best cover you.
Additionally, the best Professional Liability Insurance policy is one where the application has been fully completed and describes in detail your full operations and how they may cause a financial loss to someone else.
Professional Liability Insurance costs can be less than $1000 per year, depending on the business operations and volume of annual revenue. Costs for Professional Liability Insurance for a high-risk business or a large volume business can be in excess of $50,000 per year.
The average cost of a Professional Liability Insurance policy for a small business is around $1500 per year. The cost of an Errors and Omission Liability Insurance policy varies based on the industry and business operation.
Professional Liability Insurance can be found by contacting a licensed insurance broker that specializes in business insurance—and that specifically specializes in Professional Liability Insurance.
While any licensed insurance broker can sell Professional Liability Insurance, you should consult with a broker that has the knowledge and expertise to present your application to multiple insurance carriers. This will ensure you receive multiple quotes and coverage options. Krywolt Insurance Brokers specializes in Professional Liability Insurance.
Increasingly, clients and contracts require Professional Liability Insurance. When providing a professional service to a client, it’s common for the client to require Professional Liability Insurance—especially if there’s a risk of financial loss from the service being provided.
For example, oil and gas contracts often require Professional Liability Insurance for drilling consultants, engineers and other occupations. Likewise, IT contracts also often require evidence of Professional Liability Insurance before any work can be completed on a large network or computer system.
Professional Liability Insurance is important when business operations involve any form of professional service or advice. It’s important to have Professional Liability Insurance if your services include the potential to make a mistake that could result in a financial loss for your client.
It’s also important to have Professional Liability Insurance if you’re performing services directly on a person or animal that may result in injury. This would include barbers, tattoo artists, surgeons or veterinarians.