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Business Insurance

This blog covers topics related to specialty business insurance for a wide ranging list of small, medium and large businesses. Coverages include general liability, professional liability, workers compensation, property insurance, business umbrella, liquor liability and other specialty insurance coverages.

All About Professional Liability Insurance

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Professional liability insurance, commonly known as PLI, is an insurance that protects professionals, including accountants, lawyers, engineers, architects, doctors, chartered accountants, and medical practitioners against negligence and other claims initiated by clients. Professionals who have years of experience in a specific area needs this type of insurance because general liability insurance does not protect against claims arising out of business or professional practices, including negligence, malpractice, or misrepresentation. Professional liability insurance also protects business interests against legal claims for errors, omissions, professional neglect for both the principles as well as their employees.

Key Advantages of Professional Liability Insurance Policy

There are countless benefits of the professional liability insurance policy. Let’s take a look at some of them below:

1.      Designed to meet the requirements of different professionals and professional services

2.      Exhaustive coverage against several risks

3.      Cover legal expenses as well as the cost incurred with the prior consent of the insured

4.      Hassle-free paperwork

5.      Mid-term changes in the sum insured allowed

How Does It Work?

Depending on your profession, this insurance may have different names, including medical insurance for the medical professionals, and error & omissions insurance for real estate agents. Professional liability insurance is a kind of coverage policy that does not provide under homeowner’s endorsements, in-home business policies or business owner’s policies. It only consists of claims made during the policy period. In general, this coverage policy is arranged on a claims-made basis. It means this policy is good for claims made during the policy period.

Professional liability insurance covers the insured against loss arising from any claim made during the policy duration by reason of any covered error, omission or negligent act committed in the conduct of the insured’s business during the policy duration. Incidents that occur before the coverage will not be covered; however, some policies may include a retroactive date.

What Does Professional Liability Insurance Not Cover?

This coverage policy does not include criminal prosecution or any type of legal liability under civil law. Cyber liability that includes data breach and other technology issues will not be included in core policies. In addition to this, professional liability insurance that covers data security and other technology security-related problems is available as a separate policy.

Additional Details

There are some professional liability policies that are worded more tightly than others. However, there are some policy wordings that are created to satisfy a stated minimum approved wording that makes them easier to compare, others dramatically in the policy they cover. For instance, breach of duty may be included if the event occurred and was shared by the policy owner to the insurer during the policy duration.

Wordings with legal differences can be similar to non-lawyers. For example, policy for error or omission covers the policyholder against loss/circumstances incurred as a result of any professional error or omission, or negligence act.

Example of Professional Liability Insurance Policy

Medical malpractice insurance is the most common example of a type of professional liability insurance. Professionals who belong to medical line do their work under the not inconsiderable threat of dealing with lawsuits for alleged medical malpractice that shows as an act or omission by a medical professional in which he or she provides treatment that comes below the standard of care that results in injury to or the death of the patient. While many malpractice cases are treated as civil torts in the US, a medical malpractice insurance policy can offset the cost of lawsuits to providers.