Offering professional services can be immensely rewarding, but it also comes with many responsibilities. That’s why the protection offered by professional liability insurance is crucial.
Keep reading to learn more about professional liability insurance, from a basic definition to tips to help you determine how much professional liability insurance you need.
How Much Professional Liability Insurance Do I Need?
This question must be answered on a case-by-case basis because every industry (and in fact, every job) has a unique risk profile.
The amount of professional liability insurance you need will depend on factors such as:
- The size of your business
- The location of your business
- The specific risks you face
- The legal requirements of your profession
- Contractual obligations to your clients
- The number of employees you have
- Business structure (for example, sole proprietorship)
Coverage limits for professional liability insurance tend to range between $250,000 and $2 million.
The best way to figure out how much professional liability insurance you need is by talking to an insurance professional. If you need help, contact Carter Bradley Insurance Services: We’ll be glad to answer all your questions.
What Is Professional Liability Insurance, Exactly?
Professional liability insurance is a type of insurance that protects professionals who operate their own businesses against claims of negligence.
There are two basic types of professional liability insurance: claims-made and occurrence. Here’s the difference between them:
- Claims-made: In order for the coverage to apply, the policy must be in effect both when the event took place and when a lawsuit is filed.
- Occurrence: Covers incidents that occur while the policy is in effect, regardless of when you file a claim.
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Who Needs Professional Liability Insurance?
As a general rule, if you offer professional services or give professional advice, then purchasing professional liability insurance is a good idea.
In the case of professionals such as attorneys or doctors, they are required in some states to carry specific types of professional liability insurance (legal and medical malpractice insurance, respectively).
In addition to lawyers and doctors, a non-comprehensive list of professionals who should consider purchasing professional liability insurance includes the following:
- Real estate agents and brokers
- Software developers
- Investment or financial advisors
- IT consultants
- Consulting agencies
- Insurance professionals
If you think you have enough protection because you are already insured, think twice. Remember that coverages such as in-home business policies or Business Owners Policies (BOP) do NOT include professional liability insurance.
For more ways to protect your business, read our previous blog, “Cyber Liability Insurance: Who Needs It and Claim Examples”
Looking for Professional Liability Insurance? Carter Bradley Insurance Solutions Can Help
At Carter Bradley, our team is solely focused on your unique needs to find the best prices and most convenient options for the type of insurance you are looking for.
We are located in Corona, California. Contact us today by email at firstname.lastname@example.org, by phone at (951) 547-4240, or through our social media accounts on Facebook, Twitter, and LinkedIn.