Professional Liability Insurance: More than Malpractice

If asked to explain Professional Liability Insurance, you probably call to mind an image of a doctor making a mistake in surgery or a bookkeeper embezzling from a company, but these cases make up a very small portion of the Professional Liability claims that we process at Insurance Town and Country.  Many claims come from minor mistakes that occur when the obligations of a business get lost in the shuffle.

One example is if your company incorrectly files a customer’s information, in turn, failing to properly serve them.  Another example may be that an employee at an auto shop accidently uses the wrong oil in a car resulting in damage.  Professional Liability Insurance insures your business against the damages and legal costs that result from claims of negligence.

To better describe how Professional Liability Insurance protects your business, we have split it into four areas of coverage that protect against different types of negligible actions.  Each group is explained below:

Errors and Omissions Liability (E & O) — E & O covers mistakes made by employees who work on behalf of your business, if your business charges fees for your services, E & O may include coverage for errors such as failure to perform or violations of contract. Depending on your industry, your insurance needs will vary.

Directors and Officers Liability (D & O) — D & O provides financial protection for your business’s Directors and Officers that may prevent loss in the event that they are held liable from actions related to their corporate positions. This can include issues arising from conflicts of interest, mismanagement of company assets, violation of laws, etc..

Fiduciary Liability — Fiduciary covers claims that involve the violation of the Employee Retirement Income Security Act, or ERISA. If a manager, for example, violates the financial obligations of ERISA, having the right coverage can protect your company if held liable in situations from imprudent investments to failure to enroll employees.

Employment Practices Liability — With proper insurance, your business can be protected if a worker claims that his or her rights have been violated. This can include violations from sexual harassment and discrimination to violations of the Americans with Disabilities Act (ADA), mismanagement of employee benefit plans, and wrongful termination.

Now, you may understand why Professional Liability Insurance is important for any business with multiple employees.  If you still have any questions about Professional Liability or any other business insurance policies, please contact us at either of our locations.  We are more than happy to provide answers to any of your insurance questions and recommend some policy options for your business.

Denver Office                                                             Castle Rock Office
1735 E. 17th Ave. #3                                                    513 Wilcox St. #200
Denver, CO 80218                                                      Castle Rock, CO 80104
303–388-7216                                                 Phone: 303–688-1251
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