What’s the Difference Between General Liability & Professional Liability?

Transcript

What’s the difference between General Liability and professional liability?

As a business owner, figuring out what types of insurance your company needs can be challenging. The right policies depend on the risks that it faces. Businesses of all sizes are at risk of being sued, but the specific type of liability depends on what you do. If a contractor builds something that injures someone else or if a consulting the business gives bad advice and their client suffers financial losses because they relied on it, then both types can lead to lawsuits even though they have different roles. That’s where general liability and professional liability come into play.

The main difference between general liability and professional liability is in the types of services they cover. General liability covers physical risks, such as bodily injuries and property damage. Professional liability has a more abstract focus on errors or omissions that happen when rendering service to clients/customers Professional liability insurance, also known as errors and omissions insurance, provides protection for your business if you provide a service that leads to financial damages, and it also helps cover the business’ legal defense costs.

Business owners who provide professional services like doctors, lawyers and accountants should seriously consider purchasing a professional liability coverage and in some states, this is required by law. 

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