What does Professional Liability Insurance protect against?

Professional Liability Insurance is designed specifically to protect individuals and businesses from claims arising due to professional errors, omissions, or negligence in the services they provide. This type of insurance is particularly important for professionals such as doctors, lawyers, accountants, and consultants, as they can be held liable for mistakes made while performing their professional duties, even if those errors were unintentional.

The focus of this insurance is on the professional aspect of the services provided, rather than physical damage or theft of property. For example, if a consultant provides faulty advice resulting in financial loss for a client, Professional Liability Insurance would cover the legal costs and any settlements related to that claim. This coverage is crucial for professionals because it helps mitigate the financial risks associated with lawsuits and claims that may arise from the services they offer.

In contrast, the other options relate to different types of insurance coverage. Property damage during business operations, theft of business property, and fire damage to physical assets are typically covered under general liability insurance, property insurance, or specific endorsements, rather than Professional Liability Insurance. This distinction is important for understanding the specific protections offered by different types of insurance policies in a commercial context.