As a business owner, you’re probably familiar with business insurance. But do you know what types of business insurance you need? Benzinga has put together this guide to professional liability insurance to help you understand the product and find the best option for your business.
Best Professional Liability Insurance:
- Best Overall: HIG (Hartford Insurance Group)
- Best for Risk Analysis: CNA
- Best for Self-Employed: Hiscox
- Best for Small Businesses: biBERK
- Best for General Liability Insurance: Zurich
- Best for Medical Malpractice: The Doctors Company
- Best for Product Liability: AIG
- Best for Other Types of Insurance: Progressive
Best Professional Liability Insurance Options
If you think your business needs professional liability insurance, you should compare providers before choosing your policy. Here are some of the best options for professional liability insurance coverage.
1. Best Overall: HIG (Hartford Insurance Group)
If you’d like to get all of your business insurance in one place, you’ll want to look for an insurance provider that can offer you several products. The Hartford (HIG) is one of those providers. In addition to professional liability insurance, you can get other common business insurance products, such as general liability insurance and workers’ compensation insurance.
When choosing your insurance provider, you’ll also want to look into its claim process and customer service options. HIG offers the ability to file all of your claims by phone or online 24/7. If you have questions or want to discuss the insurance products, you can reach HIG’s customer service team by phone to get answers in real-time.
2. Best for Risk Analysis: CNA
Do you want to reduce the number of claims you’re getting in the first place? If so, you’ll want to look for an insurance provider who can help you evaluate the risks of your business. CNA goes beyond offering coverage for your business and can help you evaluate risks and create solutions for your business.
You can also get other business insurance products from CNA, including general liability, workers’ comp and employment practices liability insurance. A downside of CNA, however, is that you may not be able to get a quick and easy online quote from this insurance provider.
3. Best for Self-Employed: Hiscox
If you’re self-employed, your business insurance needs are different from other small businesses. Hiscox can offer you professional liability coverage that’s tailored to the specific risks you face. Your coverage from Hiscox includes coverage for claims for libel and slander and $200,000 copyright infringement coverage. Hiscox also offers coverage claims from previous work you’ve done. Hiscox offers monthly payment options with no additional fees and coverage that can begin in just minutes.
4. Best for Small Businesses: biBERK
biBERK specializes in providing professional liability policies that are tailored for your small business. To get started, you provide information about the number of employees you have, your industry and where you perform your work.
biBERK then puts together a quote for your business. Unlike many other insurance companies, biBERK directly insures your business. This means that you can save up to 20% on your policies because you aren’t paying an insurance broker or middleman.
Your biBERK policy may come with a retroactive date to help you receive coverage for claims that come from work you’ve performed in the past. You can also add cyber liability insurance to your policy to cover cyberattacks and data breaches that affect your clients.
5. Best for General Liability Insurance: Zurich
Zurich offers a wide range of business insurance products, including general liability insurance. It allows flexible payment options to best fit your needs, no matter how big or small your business is. You can get a general liability insurance policy from Zurich that’s very specific, including coverage for handling animals and driving antique vehicles.
Zurich also offers liability insurance with enhanced risk coverage. You’ll also benefit from its globally-consistent policy language. This policy language can make it easier to understand exactly what coverage your policy offers.
6. Best for Medical Malpractice: The Doctors Company
Medical malpractice claims can be difficult to navigate. If you’re a medical provider, you’ll want to find an insurance provider who will be there to help you if there is ever a claim filed against you. For this, consider an insurance provider that specializes in liability insurance for medical practices.
The Doctors Company is indeed run by doctors, so you know that the company can understand the complex issues that your practice might run into. It specializes in managing your professional risk to try to reduce claims from happening. And, if you do face a claim, you can rest easy knowing that The Doctors Company will be ready to defend you.
7. Best for Product Liability: AIG
If your business creates products, you’ll need to look for a product liability insurance policy. AIG is one of the largest insurance carriers in the world. It has experience insuring a wide range of businesses, each with unique risks.
In addition to product liability insurance, AIG also offers contaminated product insurance and product recall policies. This can be especially helpful if your business is involved with products that face a higher chance of being recalled, such as vitamin supplements and auto parts.
8. Best for Other Types of Insurance: Progressive
You might have other types of insurance policies outside of your business. If you prefer to keep all of your policies in the same place, look into an insurance provider who offers more than business insurance. Progressive offers car insurance, other vehicle insurance, renters insurance, home insurance and more.
Progressive’s suite is impressive — it offers general liability, professional liability, business owners policy, cyber insurance, commercial auto and workers’ compensation insurance. Its website makes it easy to receive a quote for any type of insurance product you are interested in. All you need to do is click on the “quote button” and start by entering your ZIP code and the type of insurance product you’re interested in. Progressive’s professional liability insurance offers the standard coverage you’d expect, as well as coverage for work that is performed anywhere in the world.
What is Professional Liability Insurance?
Professional liability insurance is a business insurance product that is particularly important for a few different industries. This insurance primarily protects you against claims filed by your clients. The types of claims it can protect you against include medical malpractice claims, negligence and misrepresentation.
If you already have a general liability insurance policy, you should know that it does not protect you against the same types of claims. This is why professional liability insurance is important in certain areas of expertise. Some examples of professionals who might need a professional liability insurance policy include:
- Business consultants
- Medical providers
- Real estate agents
You should know that professional liability insurance may be sold to you under a different name. For example, if you’re a medical provider, your professional liability insurance policy could be called medical malpractice insurance. It can also go by the name of errors and omissions insurance, commonly when sold to real estate agents.
Now let’s take a look at how professional liability insurance works. These policies are usually arranged on a claims-made basis. This means that your coverage can only be used for claims that are made during your policy period. You can expect your professional liability insurance policy to protect you against losses that come from a claim that is made against you or your business.
With any insurance policy, you can only receive coverage for claims that are covered by your policy. If your client or patient claims that you made an error, omitted information or were negligent, it will probably be covered by your policy. This is true whether you made an error or omitted information, or did not. The most careful provider can face a claim from a disgruntled client who believes that you were negligent.
Professional Liability Policies
When you compare professional liability insurance policies, you’ll want to pay close attention to the wording of each policy. Some policies have more generic wording and cover a broader range of claims. Others may have more careful language in its policies. For example, if the policy says that it covers “negligent acts, negligent errors or negligent omissions,” this is more restrictive than a policy that covers “negligent acts, errors or omissions.”
Negligent acts, negligent errors or negligent omissions: This more restrictive policy only covers claims that allege that you or your business were negligent. Any claims that allege that you made an error or an omission that was not negligent would not be covered.
Negligent acts, errors or omissions: This wording includes the word negligent but the policy will cover non-negligent claims. The wording here separates the negligent acts from other types of claims by not including the word negligent in front of errors or omissions. It seems like a small, unimportant difference but it can completely change your coverage.
Your professional liability insurance won’t cover everything. Some of the protections not included in these policies are:
- Criminal prosecution
- All forms of legal liability (only the legal liabilities listed in your policy are covered)
- Coverage for cyber liability (data breaches and other issues related to technology)
If you purchase your professional liability insurance policy from a company that offers other business policies, you may be able to add on separate policies.
Cost of Professional Liability Insurance
The cost of your professional liability insurance depends on a number of factors:
- Your industry
- The size of your business
- Your deductible
- The amount of coverage you have
Quite a few insurance providers offer an average cost for its professional liability insurance product.
- Progressive reports that in 2019, the national average cost for professional liability insurance through its Progressive Advantage® Business Program was $50 per month.
- Pogo reports that many self-employed people can expect to pay between $500 and $1,000 per year for a liability insurance policy.
- Insureon reports that the median annual cost for its professional liability insurance is about $710. This breaks down to $60 per month.
There are a few ways you can save on your professional liability insurance policy. Most likely, you are purchasing more than 1 business insurance product. If you purchase multiple products from the same provider, you might have the option to bundle your insurance products. Bundling can earn you discounts on your policy. You’ll also benefit from keeping all of your policies in the same place.
Speak with your insurance agent about other discounts that you qualify for. You may be able to receive discounts for lowering risks at your business. Some insurance providers also offer loyalty discounts for your continued business and group discounts for being in a certain profession.
Do You Need Professional Liability Insurance?
Now you might be wondering if you really need professional liability insurance, or if you can get by without it. The short answer is: if you specialize in a certain industry, you should consider getting professional liability insurance. General liability insurance does not offer the same protection as professional liability insurance policies.
Shop around and get quotes from a few different insurance providers. Most providers will suggest insurance products for you based on your industry, the size of your business and your specific needs.