What Types of Businesses Carry Professional Liability Insurance?

Even the most meticulous professionals can face unexpected challenges and disputes arising from their work. Many businesses carry professional liability insurance, also known as errors and omissions (E&O) insurance, to help safeguard against potential legal and financial consequences. 


This insurance coverage protects businesses and individuals from claims alleging negligence or failure to perform professional duties. Professional liability insurance is appropriate for many types of businesses. 


Professional Services Firms 


Professional services companies provide expertise-based services to clients, which leaves them vulnerable to claims of errors, omissions or mismanagement. Common examples of professional services firms include the following: 

• Legal firms—Lawyers, attorneys and law firms often carry professional liability insurance due to the high stakes and potential financial implications of legal malpractice claims.

• Accounting firms—Accountants and accounting firms face scrutiny when handling financial matters for their clients. Professional liability insurance is crucial to help safeguard against negligence claims or inaccuracies in financial statements.

• Medical practices—Doctors, surgeons, dentists and other healthcare providers need professional liability insurance to protect against medical malpractice claims, which can be financially ruinous.

• Engineering and architectural firms—Engineers and architects must carry professional liability insurance to cover errors or design flaws that could lead to property damage or personal injury.

Technology and IT Companies 


Technology and IT companies often carry professional liability insurance to protect themselves from claims related to software errors, data breaches, system failures or failure to deliver promised results. This coverage is crucial in the rapidly evolving tech industry, where a small oversight can lead to substantial losses. 


Consulting Firms 


Consulting firms offer specialized advice and recommendations to their clients, making them susceptible to claims arising from alleged negligence or subpar performance. Management consultants, human resources consultants, marketing consultants and other similar entities typically opt for professional liability insurance to shield themselves from potential lawsuits and maintain their reputation. 


Real Estate Professionals 


Real estate agents, brokers and property managers often handle significant financial transactions on behalf of their clients. Mistakes in property valuation, contract preparation or disclosure issues can lead to substantial claims. Professional liability insurance in the real estate industry is essential for protecting against allegations of errors, omissions or breaches of fiduciary duty. 


Media and Creative Professionals 


Creative industries, such as advertising agencies, graphic designers, writers and media companies, often carry professional liability insurance. Claims related to copyright infringement, libel, defamation or breach of contract can arise, and this coverage may help protect against such risks. 


Contact Us 


Contact Svedsen Insurance Agency in Woodbridge, Connecticut, for a personalized professional liability insurance quote. 


 
This blog is intended for informational and educational use only. It is not exhaustive and should not be construed as legal advice. Please contact your insurance professional for further information.