Why Businesses Need Professional Liability Insurance
Professional Liability Insurance, sometimes more commonly known as Errors and Omissions or E&O, is liability insurance that helps protect individuals and companies that provide professional advice or services. In the event of a negligence claim made by a client, this type of insurance will protect your business client from suffering the full costs of defending their entity.
One of the most common forms of professional liability insurance that most individuals are familiar with is malpractice insurance for healthcare providers. However, there are many businesses that need this type of insurance, including:
Real Estate Agents. In a previous post we discussed Professional Liability for Residential Real Estate Agents and the different scenarios in which a residential real estate agent could find themselves facing a legal claim, such as violating the Fair Housing act or providing false advertising. Customers today have higher expectations, increasing the chances of a lawsuit.
Property Managers. The most common reason for litigation against property managers is an error or omission in the written terms of the contract they hold with their tenants. Contracts must include a detailed descriptions of services and fees, responsibilities of the property owner, contract duration, and more.
IT Consultant. Let’s say that your computer consultant client has been contracted to back up their customer’s business records, and the external hard drive they use fails, causing them to lose all of that data. Their customer could then make a claim against them for using improper backup procedures which caused their failure to deliver the services offered.
These are just a few of the businesses that will benefit from professional liability insurance in the event of litigation. The best way for your business clients to guard themselves financially from claims is by investing in this type of insurance. However, by helping them familiarize themselves with this potential claims, you could be helping them limit their risk exposure.
PLRisk Advisors is a leading wholesale insurance brokerage covering the professional liability market. Our team of seasoned professionals has the depth of knowledge to help our agency partners secure the best quality of coverage for their clients. We provide Professional Liability insurance products for a number of professionals. For more information, contact us at (855) 403-5982.