Professional Liability Insurance
It’s not just enough to be a practicing professional, you also need to protect yourself with professional liability insurance coverage. Professional liability insurance shares the same coverage similarities with Professional Indemnity Insurance (PII). This will protect the professionals from any lawsuit and legal actions filed against them in the line of work.
What is professional liability insurance?
First and foremost, Professional liability insurance, PLI or PII for short is the type of coverage that protects only professionals. Ranging from doctors, engineers, caregivers, lawyers, and anyone in the professional job line. PLI protects these professionals from any claims of negligence or malpractice that may be filed against them by their clients.
More so, except you are not practicing. If not, it becomes a necessity that you must purchase professional liability insurance. You can buy other kinds of insurance, like general liability insurance. However, they will not give you the kind of coverage professional liability insurance will give you. Again, this insurance takes up different names for different professional jobs.
Types of Professional Liability Insurance
As a business person or a professional, it is your duty t know the type of liability insurance that best works for your profession. Although we have included some specific coverage that can work for you.
Medical Malpractice insurance
Now, this is among the well-known type of professional liability. It is for the medical providers. It covers the doctors from any liability lawsuit filed by a patient that claimed they were mistreated. Furthermore, a serious-minded physician always goes for medical malpractice insurance. This shows seriousness to most patients.
Directors and officers’ insurance
The directors’ and officers’ insurance package is tailored towards a portion of workers in a company. That is people that are holding high ranks in a company with leadership and decision-making roles. So, directors’ and officers’ insurance protects them from risks associated with these roles.
Professional Indemnity Insurance
This kind of insurance covers the professional from any claims of inadequacy or negligence. For instance, your client may file a claim against you that you did a poor job or a reckless job.
These claims may insist that the client ran into some financial loss due to poor services. So, professional indemnity, just like professional liability insurance protects you from any costs or expenses from the legal actions.
Errors and Omissions (E&O) Insurance
Also, this insurance can pass for professional liability insurance. Here, it covers the cost and financial expenses of a lawsuit filed against you by a client. Errors and omissions protect mostly the professionals that give people advice for a fee.
So, if your job offers advice in a sort of professional way, you must purchase your insurance. Else, you may find yourself paying a lot of money for lawsuits from unsatisfied clients.
Professionals that use errors and omissions insurance
- Investment advisers
- Accountants
- Lawyers
- Insurance agents
- Brokers
- Real estate agents
- Electricians
General liability vs professional liability
Now, general liability and professional liability work differently. Although they both serve businesses, yet, they do not provide the same coverage. To understand it properly, here’s an explanation.
General liability
General liability covers any business or company from lawsuits from non-workers or employees. If anyone ever files a claim against your company due to injury or damage.
Moreover, this injury or damage must have taken place on the business property. Therefore, general liability will take care of the cost of the lawsuits, legal fees, attorney’s fees, and the compensation for the client.
Professional liability
This is specially made for people in the line of professional jobs. Just like professional indemnity, errors and omission.
They are all for the professionals to protect them from lawsuits filed against you from a third party and claiming negligence, omissions, mistakes, reckless services, and malpractices.
What is not covered under professional liability
Basically, if it is a criminal prosecution, your policy draws the line there. Your coverage does not cover any criminal prosecution filed against you as a professional. Also, your coverage can not protect you from all legal liabilities found under civil law. Indeed, there are limits to what your insurance plan can protect you from.
Again, this coverage can not work for Cybercrimes and related internet crimes. As a matter of fact, you are mostly covered when you did not act intentionally.
Advantages and disadvantages
Firstly, the advantage of this policy is that it helps you carry out your job without the fear of financial loss from aggrieved clients.
Disadvantages
However, the disadvantage of this policy is that the policy wording may be tight and less favorable. It is better you read the policy carefully because it does not have a standard rule that guides it. So, be sure that your liability coverage policy wording is in your favor before you go for it.
Professional liability insurance companies