After several years of hard work and sacrifice, you finally have the money to open your own business. It only makes sense to protect your investment with one or more business insurance policies. Most business owners understand the importance of general liability, product liability, and commercial property insurance, but many don’t stop to consider the implications of not having professional liability insurance. A common misconception is that only doctors, lawyers, and other professionals who complete extensive training require this type of coverage. In reality, any business that provides advice or service to others needs professional liability insurance.
Understanding Professional Liability Insurance
Professional liability insurance, which is also known as errors and omissions, protects business owners from lawsuits originating from errors, negligence, or malpractice by themselves or an employee. Doctors are required to carry this type of insurance, but it is optional for most other self-employed individuals or business owners.
Assume that you are a business owner that offers consultation services and computer software programs to your clients. After meeting with one of your associates weekly for several months, your client purchases a computer program from your company to manage its invoices. You don’t hear from him or her again for three months until you receive notice of a pending lawsuit. Your client claims that your colleague’s advice was wrong and the computer program had so many issues that it cost him or her thousands in lost revenue. Because the client is claiming negligence, this lawsuit is unlikely to be covered under your general liability policy.
Helping You Assess Your Risks
As a long-time insurance agent with Oyer, Macoviak and Associates, I have helped numerous business owners decide whether they need professional liability insurance. In addition to calculating your potential risk, I help you to understand the common features and exclusions of an errors and omissions insurance policy. Please contact us for a consultation to discuss all of your business insurance needs.
Robert Macoviak is the President of Oyer, Macoviak and Associates. Oyer, Macoviak and Associates is the oldest independent insurance agency in Boynton Beach and has been in business since 1953. Oyer, Macoviak and Associates are vested members of the community who are committed to doing business face-to-face and being your insurance advocate in times of need.