What is professional liability insurance?

Liability Insurance
This policy, also known as errors and omissions insurance, protects small businesses against client lawsuits claiming that work was unsatisfactory, negligent, late, or never completed.
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When do small businesses need commercial general liability insurance?

Professional liability insurance is designed for professionals who make a living off their expertise. It addresses risks unique to providing specific services, such as an engineer who misses a project deadline or an architect who makes a mistake with plans for a building.

If the client sues, this policy covers the cost of a lawsuit up to your policy limit. Clients may request a certificate of insurance as proof that you have this coverage.

What’s the difference between professional liability and errors and omissions insurance?

Professionals who use the term professional liability insurance include:

  • Accountants
  • Architects
  • Consultants
  • Engineers

Professionals who instead use E&O include:

  • Insurance Agents
  • Real estate agents
  • Tax preparers
  • IT professionals
* Additionally, medical and legal professionals, such as doctors and lawyers, refer to this policy as malpractice insurance.

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