Professional Liability Insurance
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What is Professional Liability Insurance?
Professional liability insurance, also called errors and omissions insurance (E & O insurance) or indemnity insurance, protects your business if you are sued for negligently performing your services, even if you haven’t made a mistake. View our quote examples to understand how much professional liability insurance costs. Some examples of what could be covered are below.
Why do I need Professional Liability Insurance?
Professional liability insurance coverage gives your business protection from the risks you face in delivering your professional services. The section below discusses everything our professional liability insurance coverage offers since we want you to feel secure about what your policy does and doesn’t cover. You should seriously consider professional liability insurance coverage if your business:
- Provides a professional service.
- Regularly gives advice to clients.
- Is requested by a client to have professional liability insurance to complete a contract.
What does Professional Liability Insurance cover?
What is covered?
- Alleged or actual negligence
- Defense costs
- Personal injury (e.g., libel or slander)
- Copyright infringement
- Worldwide coverage
- Temporary staff and independent contractors
- Claims arising from services provided in the past
- Claims and damages
What is not covered?
- Bodily injury or property damage
- Fraudulent acts
- Employment matters
- False advertising
- Patents and trade secrets
- Personally identifiable information
- Other services
Example professions we insure
Your Professional Liability Insurance policy covers claims of
Alleged or Actual Negligence
Our professional liability insurance coverage can protect you and your business against actual or alleged errors and omissions that may occur while providing your professional services. These claims can include anything from giving incorrect advice or omitting a piece of information to failing to deliver your service within a desired timeframe.
Professional liability insurance coverage may be useful for a range of business types throughout various industries. Some examples may include:
- Engineers or designers sued by clients for misinterpreting renderings and/or ordering costly materials that can't be used.
- Project Managers sued for project delays and cost overruns after failing to inform clients about necessary sign-offs.
- A massage therapist sued by a client for purported tissue damage following a massage, even if the therapist stopped the massage immediately at the onset of pain.
- Medical billing employees sued for incorrectly coding medical procedures on an insurance form.
- Public notaries sued for notarizing a document in which not all of the required fields were completed.
The above are just a handful of innumerable scenarios in which a professional liability policy could cover your claim expenses and relevant damages resulting from a negligence claim.
As a small business insurance provider, we take pride in being available for our clients whenever they may require our services and guiding them through the entire legal and insurance process after a claim has been made. When a covered claim is reported, we’ll defend you immediately, professionally, and expertly. If necessary, we’ll also appoint an attorney to represent you in the matter, even in the event that the claim is groundless.
Some examples in which the need for defense costs may arise include:
- Management Consulting: You make a recommendation to your client that turns out poorly, and you're later sued for the financial loss. In such case, our professional liability policy may pay for your defense costs and judgment.
- Process Serving: A process server accidentally serves the wrong person and is sued by the innocent party for character damage.
- Property Management: A claim is made against you or your firm for purportedly denying a rental lease based on a tenant's race.
- Real Estate Brokerage: A real estate agent is sued for allegedly failing to disclose a property’s defects before closing a sale.
These hypothetical scenarios demonstrate examples in which the need for defense costs may arise. Regardless of business type, size, and industry, if your organization is sued you could face significant costs for a legal defense, whether or not you have committed any wrong. This is where we would step in to protect you and your business.
Personal Injury (e.g., Libel or Slander)
Libel and slander are forms of personal injury with legal ramifications which could negatively affect you and your business. Whether the claims are valid or not, if you or a colleague are purported to have said or written something untrue or negative about another person or business, you may be sued for personal injury. Alleged libel and slander claims may arise from intentional disparaging of a person or business, an accidental slip-up made in conversational passing, or anything in between. Fortunately, our professional liability insurance coverage can step in to protect you and your business against such claims.
Even if you do your very best to comply with copyright laws, mistakes, oversights, and misunderstandings can still occur. At Hiscox, we encounter businesses facing copyright infringement risks. We've built our professional liability protection in part to expertly protect against such claims of infringement.
For example, IT or technology consultants can be sued for infringing software code. Software developers could face allegations that their code was obtained from a program made by another developer, resulting in a subsequent intellectual property infringement claim. In response to these, we offer IT consultants and software developers $200,000 of coverage for damages and claim expenses relating to such risk.
Similarly, for marketing consultants, we include $200,000 of coverage for damages and expenses for claims alleging the infringement of a third party’s copyright or trademark. If you’re a direct marketing professional or a research consultant, for example, our professional liability coverage may allow for a retroactive or “retro” date, meaning we will cover claims made during the policy term due to actions from potentially as far back as the start of the business if there are no claims or circumstances that could lead to a claim.
Our copyright infringement coverage has served media consultants, advertisers, graphic designers, and professionals who provide a search engine as well as market research services.
Temporary Staff and Independent Contractors
Your business can be sued for any alleged wrong or error committed by any employee representing your brand, including temporary staff and independent contractors. In such case, we can step in and protect you and your business against these claims.
One such example may arise when a professional photographer hires a temporary assistant to help out with a large-scale job. If the photographer’s assistant is alleged to have breached his/her contract or have committed an act of libel or slander against a client, professional liability insurance could protect the photographer’s business from unexpected legal expenses.
There is a certain amount of risk involved in hiring temporary staff and independent contractors, but the operational and financial benefits often outweigh them. This is especially true when you have Hiscox confidence behind you for each hiring decision.
Claims Arising from Services Provided in the Past
Claims can be made against you or your business for work that was completed in the past. At Hiscox, we may be able to cover such a claim that is made during the policy period, even if the alleged wrong took place before you were insured with us.
This is what we call a retroactive (or retro) date, and its purpose is to provide protection from claims that arise from prior work that you have undertaken. A retro date may exclude claims that arise from work before the date shown. For example, the retro date for building inspectors is the policy inception date, but we may be able to match the date on your current active policy. This policy provision also applies to engineers, interior designers, and project managers. For acupressure service providers, art therapists, audiologists, and many other professionals, Our professional liability insurance may use the business begin date as the retro date if there are no claims or circumstances that could lead to a claim.
Contact us to learn more about how we may be able to cover your claim that occurred before you purchased your first professional liability insurance policy with us.
Worldwide Professional Liability Insurance Coverage
In today’s modern world, business knows no geographic boundaries. And fortunately, if you are insured by Hiscox, our coverage extends worldwide. We pride ourselves in covering claims that arise from work performed all around the world, no matter which city, country, or continent you’re working in. However, note that the claim must be filed in the United States, a U.S. territory, or Canada for us to be able to handle your claim
Worldwide professional liability insurance coverage is applicable for a range of professions, including:
- Architects and engineers sent overseas to create buildings and infrastructure.
- Consultants and freelancers sent to other countries to implement new strategies and ideas.
- Global IT and technology professionals working in multiple places to coordinate complex systems.
- Personal trainers hired to work for high-profile clients who travel frequently.
- Artistic professionals, such as photographers and videographers, sent to distant lands and far-away places to get the perfect shot for overseas clients.
All of these types of professionals and business owners can benefit from having our professional liability insurance, which can cover claims wherever you are in the world.
Claims and Damages
Claims may arise from innumerable scenarios. For example:
- A direct marketing consultant develops a direct mail campaign for a client that doesn’t generate the number of leads expected.
- An education consultant develops a math curriculum to improved standardized test scores for a school, but the students’ performance does not improve.
- A research consultant incorrectly researches a family’s genealogy.
- Making claims and suing for damages are also common against IT consultants, claims adjusters, event planners, and medical billing specialists.
In all of these instances, a client may sue for damages. And in all of these instances, our professional liability insurance policy can help protect you and your business.
What your Hiscox Professional Liability Insurance policy doesn't cover
We want our customers to fully understand what they are buying. Below is a summary of some of the key exclusions of your professional liability policy. For complete details of all the exclusions, please read the policy wording.
Bodily Injury or Property Damage
We will not cover damages or claims expenses if you injure or damage someone’s property. If you’d like to be covered for bodily injury or property damage liability, please visit our general liability insurance page.
We won’t cover any fraudulent, dishonest, or criminal acts. However, we’ll defend these actions until they're proven to be fraudulent, dishonest or criminal by proper process in court. If this happens, we’ll kindly request that you reimburse us for those costs.
We will not cover you for claims alleging any improper employment practices committed against your employees or for any workers’ compensation claims or employer’s liability claims.
We will not cover you for any false advertising claims.
Personally Identifiable Information
We will not cover your failure to protect any personally identifiable information in your care, custody or control.
We will not cover any medical, nursing, insurance broker/agent, legal, actuarial, architectural or engineering services, regardless of your occupation. We will also not cover any services you perform not specified by the services endorsement attached to your policy.
Learn more about Professional Liability Insurance
We gathered some of the common questions people ask about professional liability insurance, also known as errors and omissions insurance (E & O insurance). If you have any other questions not listed here don't hesitate to contact one of our licensed advisors, either by phone at 1-866-283-7545 (Monday - Friday, 8 am - 10 pm EST) or email.
Visit our professional liability FAQs page.
Get Liability Insurance that best meets your needs
Professional liability insurance will not protect you from everything. For example, it will not provide indemnity from another person’s claims of bodily injury. Some people buy other business insurance along with professional liability including:
Why choose Hiscox?
We specialize in professional liability insurance for professional services businesses like yours.
Flexible payment options: We offer you the option of making monthly payments (with no additional fees) to help manage your cash flow.
- Tailored Insurance: We specialize in businesses like yours and tailor coverage to the risks in your field.
- Claims responsiveness: When a covered claim is reported, we will immediately defend you even if the claim has no basis and, if necessary, appoint an attorney.
- Coverage for contracts: Our liability insurance coverage satisfies most standard contract insurance requirements.
- Worldwide coverage: We protect you for work done by your business anywhere in the world, as long as the covered claim is filed in the United States, a U.S. territory or Canada.
- Passion for Service: Agents knowledgeable about your business concerns will provide you with excellent service – 4.7/5 of people surveyed recommended us.
Hiscox Customer Reviews
Marjorie, Miami, Florida
Prompt and efficient customer service
Peter, Naples, FL
"Painless experience! It was very easy to get the coverage that was needed. I would definitely recommend this to others in small business."
Jason, Danville, VA
Super easy. Good rate too.
Andrew Thomas Clifton, Chicago, Illinois
Simple. Some of the site was a bit overpacked and it slightly overwhelmed me at times but everything else was great
Leveda, Medora, Indiana
Fast and friendly service
This information is provided to assist you in understanding the coverage we offer and does not modify the terms and conditions of any insurance policy, nor does it imply that any claim is covered. Specific coverage terms can vary by class of business. Coverages are subject to underwriting and may not be available in all states.