THURSDAY, MAY 20, 2021
Professional liability insurance, also known as errors and omissions insurance, is designed to protect you and your business when your general liability policy might not provide adequate coverage. General liability policies usually exclude coverage for any harm you might cause someone while carrying out your work or because you bad advice was given.
How Does Professional Liability Insurance Work?
The purpose of professional liability insurance is to cover you and your business in the event that you make a mistake that results in either physical or financial harm to your customers. For instance, if your job involves editing training materials for medical technicians, you might want to have professional liability insurance to cover you if there's a mistake in the documents that causes a patient to be improperly treated.
An alternative scenario is one in which a real estate agent is sued by a buyer who claims that the house that the agent advised him to buy has serious and expensive defects. Professional liability insurance can cover both damages and attorney fees if the agent loses the case (and covers legal fees if he wins the case). Just a few other professionals who might benefit from purchasing professional liability insurance include journalists, medical professionals, architects and attorneys.
Obtaining Professional Liability Insurance
Underwriting a professional liability insurance policy is more complex than it is for most other types of policies. A professional liability policy that works for you might not work for someone else. Because the various professionals who might need this kind of policy face different types of risk exposures, the policy has to be custom-designed to accommodate the specific needs of each policyholder.
The underwriter will ask to review relevant business documents, such as your contracts and training materials. The underwriter will probably also want to review any claims that might have been filed against your business previously. How much your policy will cost will depend on the nature of your business. An advertising agency might spend only a couple of hundred dollars per year, while coverage for a medical professional might run into the tens of thousands.
No Comments
Post a Comment |
|
Required
|
|
Required (Not Displayed)
|
|
Required
|
All comments are moderated and stripped of HTML.
|
|
|
|
|
|
NOTICE: This blog and website are made available by the publisher for educational and informational purposes only.
It is not be used as a substitute for competent insurance, legal, or tax advice from a licensed professional
in your state. By using this blog site you understand that there is no broker client relationship between
you and the blog and website publisher.
|