Public Liability Companies

An Introduction To Professional Liability Insurance Coverage

For professionals such as physicians, lawyers, architects and accountants there is unfortunately a need for protection against their clients. Insurance liability professional serves this purpose. This insurance is also refered to as professional liability insurance or professional indemnity insurance - Its name is also modified as per the specific profession. For example, for health care professionals it is called medical malpractice insurance. General liability insurance responds only to property damage or bodily injuries. But the purpose of the professional liability insurance is that a professional can receive coverage against a client claim. In addition, it can provide coverage to professions such as engineering or legal services for financial loss, failure to perform or errors in services.

Most of the reasons alleged in making claims on professional liability policy are misinterpretation, violation of faith, unfair dealing, inaccurate advice or negligence. If a software product has faults, it does not trigger general liability insurance. It also does not result in personal or advertising injuries. But it may result in huge financial loss. The cause behind it may be attributed to the software developer's inability to assess the software. Here professional liability insurance can be invoked against the client who makes allegation against the software developer or software engineering department.

Even if you have a home business owner insurance policy, the importance of professional liability insurance is not diminished. It helps protect you from any financial loss as lawsuits against professionals have become quite common in he US. In this litigious atmosphere, it may be difficult for an individual to incur financial losses from a client if his financial situation is not sound.

There is a common understanding that professionals have deep knowledge and understanding of their specialty. Their skills and methods are unquestionable. They are expected to always perform at a high standard and code of conduct. They are obliged to perform the services perfectly for which they are hired. If they fail to perform the way they are expected they, can be held responsible for any loss incurred by the client and consequently dragged into a court of law.

When liability insurance is limited to the negligence or loss of faith the insurance is called error and omission liability. This kind of insurance is provided under an in home business owners policies. Thus in a way, professional liability insurance is called special insurance.

In a country like USA where the inclination towards litigious actions is high, professionals are very much concerned with the possibility of  claims made by their clients against them in a court of law. Hence most professionals choose to have this type of insurance policy. However, it is wise to consult a legal adviser to more fully understand the intricacies of professional liability insurance.

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