Professional Liability

Professional liability insurance, or PLI, is also known as professional indemnity insurance. PLI protects professional advice and service providing companies against lawsuits brought by their clients. These policies will pay a portion, if not all, of the defense costs as well as any damages or settlements the client wins in court. PLI does not generally cover criminal prosecution costs or liabilities not specified in the policy.

What PLI Covers

You may think that general liability insurance is enough to cover you from such claims but that is not the case. PLI covers claims a failure to perform on the provider, financial loss caused by services, or errors made in service. General liability covers more tangible instances of harm such as physical damage or bodily injury.

Common claims that are covered by PLI include misrepresentation, inaccurate advice, negligence, violation of good faith, and fair dealing. For example, if a product fails to perform properly, no personal or physical damage has occurred. The customer may file a lawsuit against the developer for financial losses. General liability would not cover this claim, but PLI would.

Do YOU Need PLI?

Some professionals are required by law to carry PLI. In the case of medical professionals, this is known as malpractice insurance, protecting them against claims of mistreatment, diagnose, or misuse. For lawyers, brokers, or consultants, they carry errors and omissions insurance (E&O). E&O insurance covers mistakes that may occur when service is provided.

Other professionals outside of these fields should consider carrying PLI. Accountants and financial service providers are among professionals more likely to be sued. Construction workers, electricians, plumbers, and even general contracts need to protect themselves from claims brought on for property damage, bodily injury, or advertising injury. Even web developers and marketing specialists, architects and engineers, non-profit organizations, or any other profession where services are provided, need protection offered by PLI.

When it comes to your business, you can never be too careful. Don’t make the mistake of thinking that just because you haven’t faced a lawsuit yet that you never will. Your services may be high quality, but it only takes one unhappy customer to take away your success earned by years of hard work.

Landmark Risk Management and Insurance is the area’s expert on professional liability insurance. We can take a look at your business’ current policies and help you determine if PLI is right for you. Landmark has years of experience working with business owners and we’re ready to get you the coverage you need. Contact us set up your first appointment or to speak with one of our team members. We’re happy to answer any questions you may have!