The Risks of Not Carrying Professional Liability Insurance
Professional Liability, otherwise known as Errors and Omissions, is a fundamental coverage for any business to include in their portfolio. This broad coverage provides protection against the scope of risks that any professional who offers advice or services might face. Litigation resulting from either of these types of claims has the potential to cause financial devastation and reputational ruin for these clients. While small businesses might believe themselves to be immune from such claims, professional liability is a required coverage for any professional.
So, what is Professional Liability insurance exactly? Cavignac & Associates defines it as malpractice insurance and it is purchased by architects and engineers as well as doctors, lawyers, accountants, real estate brokers and other licensed professionals to address business liability risks that arise from rendering professional services. Although this coverage is an essential component of protecting a business, many are not aware of the actual threats that coincide with not having it.
The average cost of a court settlement over a professional liability issue is $475,000, says Tech Insurance. In addition, they also mention that approximately 70 percent of businesses raise prices or cut hiring when they are sued. Therefore, while the premium price for a company ranges depending on annual profit and the number of employees, the average 1-3 percent fee for coverage far outweighs the costs of being sued.
Bear in mind that professional liability insurance is a requirement in many states. If a business was to be sued and no coverage was active, they will suffer more serious consequences such as suspension, additional fines, and the initial litigation settlement costs.
Our comprehensive Professional Liability coverage will provide the peace of mind and financial protection that your clients need to maintain their daily operations. Further, PLRisk Advisors is a leading wholesale insurance brokerage covering the professional liability market. Our team of seasoned professionals has the depth and breadth of knowledge to help our agency partners secure the best quality coverage for their clients in various industries. Please contact us today for more information at (855) 403-5982.