As a professional, you strive to do the best job you can. You work within the standards of conduct and excellence in your field. Doing so produces a superior product or service and bolsters you or your company’s reputation. Word of mouth is great advertisement, but what happens when a client claims you have harmed them through negligence?
Who Needs Professional Liability Insurance
Whether you are a mechanical engineer, a real estate agent, a medical professional or even a software engineer, you have the potential to be sued for negligence. If a client feels that he has been harmed in some way, whether physically, financially or professionally, he can file a lawsuit against you. Guilty or not, you will likely spend thousands of dollars in defense of the accusation.
Errors and Omissions Insurance
For many professionals the term Errors and Omissions Insurance would apply. Through some perceived fault your client feels that you have harmed him or his company through faulty work or perhaps failure to provide the service at all. The client then files a law suit against you hoping to be compensated for his loss. Your errors and omissions insurance policy is set up to help cover your legal defense costs as well as damage awards won by the client.
How Much Coverage is Necessary
Professional liability Insurance policies usually have a set limit of liability and often everything from legal fees to award payouts all fall under the same limit. For this reason you should read your policy carefully to determine whether it offers enough coverage for your needs. You need to take into consideration the type of work you do and how a client might be affected by your service. The greater the rate of return your service offers a client, the more he stands to lose if the job isn’t done right. Remember, you don’t have to actually be negligent to be sued, your client only has to allege that you were negligent.
Medical Malpractice Insurance
If you are a medical professional, such as a doctor, nurse, anesthesiologist, or any other health care provider, your professional liability insurance is called medical malpractice insurance. If a patient is injured or dies and it is alleged that you failed to give necessary treatment or gave improper treatment, you could be sued. The legal fees to fight this can be astronomical even if you get the case dismissed. If you are found liable, the cost of the award could easily run into the millions. In this situation medical malpractice insurance is a must. It can help to cover these costs and save you from financial ruin.