Nov/Dec Volume 29, Number 6 | |||||
Do You Need Professional Liability Insurance?Unless you're an attorney, doctor or accountant, it may not be obvious to you that you may need professional liability insurance.
Forty percent of businesses believe they may have professional liability risks but have not purchased insurance for it, according to a recent survey of small business owners by The Hanover Insurance Company. Defense Costs
One of the most important reasons to carry professional liability (also referred to often as errors and omissions) insurance coverage is for defense costs. Even if the ice sculptor can prove that the client signed off on the design before it was unveiled, and it did indeed look like swans, the cost to defend the lawsuit could put a small organization out of business. Tailored Coverage
Whether you buy a PL or E&O policy, it usually will be tailored to the specific needs of your business classification. For instance, a policy for real estate brokers typically includes coverage for failure to advise clients on the existence of fungus, asbestos or bacteria. Policies for accountants might provide coverage for acting as a trustee or administrator of an estate. Some policies also cover inadvertent transmission of computer viruses and corruption of customers' data.
Many insurance companies offer group policies to members of trade associations. In other cases, insurance companies form buying pools that professionals can "join." Miscellaneous professional liability coverage is also available for a variety of businesses such as translators, meeting planners, publishers, and collection agencies. If you need coverage, we can advise you on the best approach. Claims-Made Policy
It is important to understand that most PL and E&O policies are written as "claims-made," which means the policy only covers claims filed during the policy period. A few companies offer occurrence-based policies, which cover any qualifying claim arising from an incident that occurred during the policy period — no matter when filed. If you switch from a claims-made to an occurrence policy, you have to make sure you don't create a gap in coverage. |
|
Marijuana Use Linked to Increased Car Crashes Do You Need Professional Liability Insurance? What's a "Reservation of Rights" Letter? What's a "Reasonable Accommodation"?
|
|||
|