Professional Liability

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Professional Liability (E&O)

Professional liability (Indemnity) Insurance, also known as Error and Omission liability, protects your company against claims that a professional service caused your client to suffer financial harm due to mistakes or omissions. A claim of negligence, malpractice or misrepresentation is not covered under a general liability insurance policy, which makes professional liability insurance crucial for those who provide a service or advice for a fee. Occupations in this job category may include attorneys, doctors, accountants, consultants, and so forth.

The coverage includes legal fees associated with defending your business in a lawsuit and any settlements that may arise out of those claims. The most common exclusions in professional liability policy forms are for bodily injury, property damage, and intentional/dishonest acts. The vast majority of professional liability policies are written with claims-made coverage triggers.

Professional liability coverage may be included as part of the BOP or base general liability policy with a limited coverage amount for small businesses. More often than not, policies are tailored to the profession which include, but are not limited to, the following:

  • Legal malpractice
  • Medical malpractice
  • Fiduciary Liability (violation of Employee Retirement Income Security Act)
  • Errors and omissions (E&O) coverage
  • Directors and officers (D&O) insurance

Premium for professional liability insurance is dependent on the type of profession, employment status, and the number of professionals.

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