Table of Contents
- What is Professional Liability Insurance for Small Business?
- What Should Professional Liability Insurance Cover?
- Do I Need My Own Professional Liability Insurance?
- What are Typical Professional Liability Insurance Limits?
Professional liability insurance, also known as errors and omissions (E&O) insurance, is a type of coverage designed to protect small business owners from the financial risks associated with professional negligence. Professional negligence is a failure to provide professional services in a manner that meets the accepted standards of practice. This type of insurance is important for small business owners because it can help protect them from costly lawsuits and other financial losses that may arise from providing professional services.
Professional liability insurance should cover any claims that arise from professional negligence. This includes claims of negligence, errors, omissions, misstatements, and other types of professional misconduct. The coverage should also include legal fees, settlements, and judgments that may result from a lawsuit. In addition, some policies may provide coverage for other types of losses, such as lost profits or reputational damage.
The answer to this question depends on the type of business you own and the services you provide. If you provide professional services, such as consulting, legal advice, or accounting services, then you should consider purchasing professional liability insurance. Even if you are not required to carry this type of insurance, it is a good idea to do so in order to protect yourself from the financial risks associated with providing professional services.
Professional liability insurance limits vary depending on the type of business you own and the services you provide. Generally, the limits of coverage will be based on the amount of risk associated with the services you provide. For example, a consulting firm may have higher limits of coverage than a small retail store. It is important to speak with an insurance agent to determine the appropriate limits of coverage for your business.