Professional Liability Insurance
Did you know that liabilities that arise from the rendering of professional services are usually excluded from a commercial general liability policy? As such, professionals and the services they offer are unique based on their line of work, skills and areas of expertise. Typically, professionals have a very different set of coverage needs. To meet these needs there are several forms of specialized professional liability insurance coverages:
Errors & Omissions Insurance
This provides professional liability insurance coverage for economic losses that arise from negligence or from an error or omission in the course of rendering professional services. Coverages can be applied for those who require medical malpractice insurance, non-medical professionals such as lawyers, accountants, media professionals, e-commerce professionals and web designers. Miscellaneous professional liability for consultants, travel agents, human resources professionals etc is also available.
- Errors & Omissions claims example: An insured placement agency secures an IT Firm to provide computer programming for an online service company. A coding error is made in the programming causing the service company’s website to be inaccessible. The placement agency is sued for $100,000 and their E&O policy defends them for this error. The investigation finds that there was an error but the client over exaggerated the amount of loss at $100,000. A settlement is reached for $30,000 including defence costs.
Directors and Officers Liability Insurance
Employment protection liability provides professional liability insurance coverage for the claims or lawsuits filed by stockholders, employees and others who could be affected by the decisions of a corporate officer or director. This coverage can be purchased for non profit and for profit organizations.
- Non-profit Directors & Officers Liability Claims example: A non-profit organization holds a fundraising event. The organizers secure an operating loan from another organization which is supposed to be paid back with the proceeds earned from the fundraiser. An employee inadvertently deposits the funds into a bank account that is used for general expenses. The non profit files for bankruptcy and does not repay the operating loan to the lending organization. A lawsuit is filed against the directors for negligence in failing to properly supervise the employee and for breach of trust. The lawsuit is eventually settled for $75,000 with defence costs at $30,000.
Employment Practices Liability
This coverage provides professional liability insurance coverage for claims filed by employees or applicants for employment for wrongful termination, failure to hire or promote, harassment, and various forms of discrimination.
Want to know more about professional liability insurance?
If you are in need of a professional liability insurance quote, contact Absolute Insurance today to speak to the professional liability insurance specialists.