Professional Liability Insurance
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What Is Professional Liability?
Also referred to as Errors and Omissions Insurance, Professional Liability Insurance protects you or your business in the event that a client holds you responsible for your professional service or advice that they believe;
- didn’t perform as promised, and/or
- was erroneous or otherwise negligent
and caused them some type of financial loss such as loss or delay in earnings or extra costs associated with fixing your errors.
Many contractors and businesses have Commercial General Liability Insurance, but unfortunately this type of policy only covers third-party bodily injury or property damage. Professional Liability Insurance covers financial damages (to third parties such as your clients) resulting from your services or advice offered in a professional capacity.
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Claim Example #1:
Negligence:
Committing an error while carrying out a professional service
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Claim Example #2:
Accusations of misconduct:
A patient may accuse you of breaking the professional code of conduct
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Claim Example #3:
Injury:
Your client may claim either physical or emotional injury as a direct result from your care
Professional Liability policies are different from Commercial General Liability policies.
Commercial General Liability policies respond to claims on an occurrence basis. This means that the policy in force at the time the damages occur will respond to the claim. Even if that policy has since expired, if it was in force at the time the damage occurred, that policy would respond.
With Professional Liability Insurance, the industry standard is for insurance companies to offer coverage on a CLAIMS MADE AND REPORTED FORM. This means that the policy will respond to claims made against you and reported to the insurer only within the policy term. The Professional Liability policy through EasyCover follows the industry standard and is also on a CLAIMS MADE form, however, we offer an unlimited retroactive date. This means we will respond to new allegations/claims made against you relating to professional services rendered prior to purchasing your EasyCover policy as long as a) you only became aware of the grievance against you during the policy term and b) the claim is reported to us during the policy term. Many other Professional Liability policies set the retroactive date to the policy inception date, meaning you do not have coverage for past work.
