If you own a small business, protecting yourself from these dangers is critical. But do you know which form of insurance will protect you—general liability or professional liability? The answer could mean the difference between being fully insured and experiencing significant financial loss.

Let’s explore all you need to know.

What is General Liability Insurance?

General liability insurance (GLI) is a type of business insurance that protects against third-party claims involving bodily injury, property damage, libel and slander, advertising injury and reputational harm as a result of your business operation. General liability goes a long way in helping cover incidents by paying for legal defense and other court costs. 

Key Examples 

• A customer slips on a wet floor in your shop and submits a claim for medical expenses.
• You accidentally damage part of a client’s property while working on their site, resulting in costly repairs.
• A competitor alleges you of using advertisements that damaged their brand, resulting in an advertising injury claim.

The Importance of General Liability for Small Businesses

Regardless of the industry that you’re in, general liability can greatly benefit your small business. By protecting your operation against the financial burdens associated with accidents, injuries, property damage, and more, your business will handle the unexpected with ease and remain successful into the future. 

Who Needs General Liability Insurance

General liability is essential for the majority of businesses but particularly those with physical location, or if businesses that deal directly with clients face-to-face. Think about businesses that could face claims involving property damage or physical injury, such as restaurants, retail stores, and contractors. 

What is Professional Liability Insurance? 

Professional liability insurance, also referred to as errors and omissions (E&O) insurance deals with claims resulting from negligence, misrepresentation, or inaccurate advice provided by your professional service. Unlike general liability, which focuses on physical risks (explained in the above section), professional liability is meant to protect service-based businesses where mistakes or advice could lead to financial loss. 

Key Examples

• An architect makes a mistake in a building design, resulting in structural concerns and expensive repairs.
• A consultant delivers poor business advice, resulting in financial losses for the customer.
• An accountant makes an error in financial reporting, resulting in tax fines for the customer.

Who Needs Professional Liability Insurance?

Professional liability insurance is essential for service businesses that offer specialist knowledge or guidance. Consultants, accountants, architects, real estate brokers, and healthcare practitioners are more likely to face accusations of carelessness or error. This coverage protects them from financial loss as a result of errors or unmet client expectations.

Do You Need Both Types of Insurance? 

Combining Coverages

In some cases, businesses will need both professional and general liability insurance. Luckily most insurance providers offer bundled coverage options where you can get both for a discounted price. 

Here are a couple examples of business who benefit from both types of protection: 

• Contractors and developers often provide advice in relation to project planning. This presents a need for professional liability insurance. On the other hand, since these professionals perform physical work on people’s properties, a general liability policy is also necessary.
• Someone who’s a graphic designer may want to invest in both types as they probably invite clients into their office from time to time, but also want protection against errors made in their physical work. 

Cost of Not Having the Right Coverage

Without the proper insurance policy, your business risks major financial losses. For example, if you only have professional liability, and someone gets injured on your property, you’ll likely still have to cover their medical expenses out-of-pocket. 

Or let’s say you have general liability insurance, but no professional coverage, and you make an error when giving consulting advice. Unfortunately with no professional liability,  you may have to pay for the costs of a legal settlement stemming from the misinformation.

Factors Influencing the Cost of Liability Insurance

• Business Size and Revenue: Larger organizations typically pay higher premiums due to increased risk and more exposure to large claims.

• Industry: High-risk businesses, such as construction, may incur higher general liability expenses, whereas advice-based industries may have higher professional liability rates.

• Location: Insurance rates vary by state and locality due to changes in laws and overall operational costs. For example, coverage in a big city may be more expensive than in a rural community. 

• Coverage Limits: Higher coverage limits provide more protection, but also raise rates. Businesses that require extensive coverage may pay extra, depending on their risk exposure.

• Claims History: A history of previous claims, indicates a higher risk and usually raises rates. 

EZ.Insure—A Quick and Affordable Coverage Solution 

EZ.Insure is the simple solution for your insurance needs, offering competitive business insurance rates and policies tailored to small businesses. With policies starting for as low as $24.95/month, your business can be equipped with a well-rounded liability insurance package, to ensure you’re fully protected without having to break the bank. 

How to Choose the Right Liability Coverage for Your Business

Steps to Consider

• Evaluate Your Business Risks: Take the time to sit down and list out all of the potential risks that your business might face. Be sure to consider both physical incidents and professional errors. 

• Consider Industry Requirements: Next, think about the typical insurance requirements in your specific industry. Based on industry norms, you should get a pretty good idea of what coverage(s) are necessary. 

• Determine Your Budget: Evaluate how much your business can realistically afford to pay per month in premium costs. Then in turn, consider the level of coverage your business actually requires. While you never want to be under-insured, for a small business, a policy with a hefty coverage limit may not be necessary.

Consult with an EZ.Insure Expert

If you’re still unsure of which coverage type is right for your business, or if you need both, seek the help of an expert insurance agent at EZ.Insure. Working with a licensed agent ensures that no detail is overlooked in regards to your business, so that you’re matched with the most optimal policy type. They’ll also be there to help with every step of the enrollment process, and answer any questions about the selected policies details, so you walk away covered and confident! 

Don’t Leave Your Business Exposed—Get Covered Today!

Liability coverage is critical for protecting your organization from unanticipated hazards and costly lawsuits. Whether you require general, professional, or both forms of liability insurance, the appropriate policy will keep your organization safe and secure.

Ready to get started?  EZ.Insure is here to help! For a fast, free quote, simply fill out a form on our site, or give us a call at (855)-694-0047 today!

Looking for more information on securing your business? Check out our resource library, that’s home to tons of helpful articles all aimed to help small businesses succeed today and for years to come. 

While you may scoff at the question at first, thinking it’s unnecessary, the truth is that just like any other business, having the proper coverage provides essential protection safeguarding everything you’ve worked for. But don’t just take our word for it. Instead, to help you make an educated decision about your options, we’ll delve into five critical questions to ask yourself. When it’s all said and done, you’ll have a solid understanding of why home-based business insurance is so essential. 

Question #1: Do You Have Expensive Inventory or Equipment?

One of the first things to think about is whether or not your home-based business involves inventory or expensive equipment. Your homeowners’ insurance probably doesn’t cover business-related objects in the case of damage, theft, or loss, even if you work from home.

Think about things such as your laptop, tools, technology or any other equipment that’s vital to your business operations. Then consider any inventory. Do you sell goods? If the answer is yes, these items could also be in danger without the proper protection. In the unfortunate case of a fire or break-in, you may have to replace these valuables out-of-pocket.

Why This Question is Important

• Your operation relies on your inventory and/or equipment and without it your business is probably not functional. 
• Without home-based business insurance, replacing these items may be very expensive or unaffordable.
•  Homeowner policies alone usually don’t cover inventory or equipment losses.

Question #2: Do Clients or Customers Ever Visit Your Home? 

Do you ever hold meetings at your house office with customers or clients? If so, you might be putting yourself in danger for responsibility if an incident occurs. For instance, you can be liable for a client’s medical costs if they trip and fall on your property, leading to an expensive lawsuit.

General liability insurance covers property damage and physical injury claims made by third parties. Even if your place of business is your house, this type of coverage  it’s still necessary for any company that deals with clients or consumers face-to-face.

Why This Question is Important

• Hosting clients without the proper home-based insurance leaves you liable in the case of an injury
• General liability coverage will take care of the costs of lawsuits or claims relating to an accident, so you won’t have to pay out of pocket. 
• Having general liability coverage puts clients at ease and bolsters your reputation as a responsible business owner. 

Question #3: Could a Lawsuit Affect Your Financial Stability? 

If you own a small business and are on a strict budget, a lawsuit could be extremely detrimental to your business. Even a small claim could have a huge negative impact. In addition to an injury-related incident, clients may also file lawsuits if they think you’ve committed a professional error or if they feel you failed to provide a promised good or service.

Unfortunately, the legal and court costs stemming from these types of situations can add up quickly and jeopardize your finances. That’s why it’s so crucial to consider investing in professional liability coverage on top of the general liability protection that we discussed above. 

Why This Question is Important

• Small businesses suffer far more than large corporations in the result of lawsuits since they generally don’t have nearly as much funds or resources. 
• Professional liability coverage takes care of legal fees, court fees, and other payouts associated with a business error. 
• Without coverage, a lawsuit could be so expensive that you’re forced to sell your assets. 

Question #4: Do You Rely on Your Home-Based Business for Income? 

If your home-based business is your main source of revenue, you should think about how an unplanned disruption could affect it. What would happen if your home was damaged by a fire, a natural disaster, or some other unanticipated incident that prevented you from using it for several weeks or even months?

Business interruption insurance acts as a safety net paying for lost income during these unexpected down times. This coverage guarantees that, even while your business is recuperating you can continue to fulfill your financial and client obligations, pay your bills, and provide for your family.

Why This Question is Important

• Without business interruption insurance, an unexpected event may force your business to shut down entirely, therefore bringing your income to a halt. 
• This coverage oftentimes provides relief in the form of a new, temporary space to operate out of. 

Question #5: Do You Use a Vehicle for Business Purposes?

While this question isn’t directly related to your home, many remotely-based entrepreneurs utilize vehicles in their day-to-day operations. Unfortunately, if you’re regularly using a car, truck or van for business purposes, your personal auto coverage probably won’t cover it.

Consider tasks such as delivery, client visits, or inventory transportation. If any of these are applicable to your company, and you aren’t properly covered, you’ll be financially liable for any accidents on the job. This is where commercial auto insurance comes in, protecting your business vehicle in the case of an accident during the work day. 

Why This Question is Important

• When using a vehicle for purposes related to your business, personal car insurance policies will not be enough. 
• If an accident occurs while you’re conducting business, you won’t have to pay out of pocket. 
• Without commercial auto insurance, you’ll be held liable for any vehicle damage, personal injuries or lawsuits stemming from the accident. 

Final Thoughts on Home-Based Business Insurance 

If you run a business from the comfort of your house, investing in home-based business insurance is crucial. Even if you still aren’t sure whether it’s necessary for your organization or not, just review the five questions listed above. If your answer to any of these questions is yes, home-based business insurance is likely a smart investment.

It’s important to get ahead of potential risks before they actually take place. If you decide not to, it could cost you an exorbitant amount of money, or even your entire business. So don’t wait for any surprises, instead, take time to review your coverage options, and find a plan that best fits your small businesses needs. 

Visit EZ.Insure For Your Business Insurance Needs

We understand that shopping for business insurance isn’t fun and it can be confusing too. Luckily for you, there’s a platform that makes finding insurance quick and easy. We’re of course talking about EZ.Insure. At EZ we pride ourselves on the seamless, simple platform that we’ve built out. All you have to do is enter your ZIP code and in a few minutes you’ll be matched with a customized insurance quote for free! We also have side-by-side plan comparison tools so you can be sure to find the perfect coverage. To get started, fill out the form above or call us directly at 855-694-0047 to get started!

Professional Liability vs E&O

Professional liability and errors & omissions insurance, or E&O, are the terms that are often used interchangeably. Historically, these two types of policies were actually different. Professional liability was bought by professionals such as doctors and lawyers. E&O was for semi-professionals such as accountants and real estate agents. Nowadays, most people don’t make this distinction between them, and use either term when talking about insurance that covers mistakes or damages that do not involve injury to people or property. 

There is, however, a small difference between the terms “professional liability” and “E&O.” Professional liability is actually more of an umbrella term that includes policies like E&O, directors and officers liability insurance (D&O), and employment practices liability insurance (EPLI). 

This small difference is also related to what type of business you have. If you’re a consultant, engineer, or accountant, you’ll probably have a professional liability policy. These policies are also highly recommended for estheticians, hairdressers, yoga instructors, personal trainers, or anyone who offers a service to customers that has a risk of going wrong. However, if you’re an accountant, real estate agent, tech professional, or anyone who could make an “error” or “omission” when giving advice, then the policy you buy is more likely to be called E&O insurance. 

Malpractice

If professional liability and E&O are essentially the same thing, then is professional liability the same thing as malpractice insurance? Well, no. As described above, the term “professional liability” is an umbrella term for insurance policies that protect businesses against lawsuits stemming from mistakes. Malpractice is a type of professional liability insurance, but professional liability is not necessarily malpractice insurance. 

Malpractice is industry-specific, required for doctors and often bought by lawyers. The idea behind the coverage is essentially the same: professionals pay premiums to be covered in case a patient or client alleges damages due to negligence. What is different in this case is who it covers. 

Insurance can be complicated. It can often seem like you need to learn a whole new vocabulary just to figure out what your business needs. Remember, you need to be covered for all eventualities. You don’t want to see all of your hard work go to waste because of one costly mistake. You wouldn’t risk your property being uninsured, and you should be just as serious about insuring yourself against unseen damages. If you are offering a service or advice to your customers/clients, then you should have some form of professional liability insurance.

If you’re looking for the right insurance for your business, EZ.Insure is the best place to look. We offer instant quotes and access to local, knowledgeable agents – for free! We’ll answer all of your questions, and will find you just what you’re looking for at just the right price. Easy as that. To get started simply enter your zip code in the bar above. You can also speak to a licensed agent by calling (855) 694-0047.

More and more Americans are leaving their cubicles to work on their own. Well, why not? You decide how to run your business. You decide when to work. Who is on your team is up to you. Those are some great perks. So it’s not surprising that there are 15 million self-employed professionals in the American workforce right now, and that number could nearly triple in the next two years.

But there are some things you can’t control or plan for in business or in life. What if something goes wrong on the construction site and one of your clients gets hurt? Or what if you get hurt in a freak accident and can’t work anymore? Those “what if” questions are enough to turn the dream of a self-employed entrepreneur into a nightmare. So, if you work for yourself, you need insurance to protect yourself, your family, and your business. You’ve worked too hard to leave anything unprotected. But how do you know which types of insurance for self-employed people need and don’t need? Let’s look at types of insurance that will make you feel safe.

Self-Employed Business Insurance

Whether you’re a plumber or a freelance writer, there’s always a chance of something going wrong with your job. Some people are more likely to get hurt on the job, while others may be more likely to be sued. Insurance for self-employed individuals is crucial to cover the risks of your work. Here are the four most important types of business insurance to look into.

1. General Liability 

Liability insurance will protect you financially in the event that someone sues you for damages after slipping and falling in your coffee shop. Or breaking an expensive vase while cleaning a client’s home. Slander suits are also covered by general liability insurance. This sort of protection is available both as a separate policy and as part of a business owner’s policy.

2. Professional Liability

Listen, we all have our flaws, and everybody messes up sometimes. This is where professional liability comes in handy. It’s insurance that protects you in the event that a client is harmed as a result of a service you provided or advice you gave. It is also known by its more common name, errors and omissions insurance. Professional liability insurance covers financial losses in the event of injury or damage. While general liability insurance covers injuries and damages to property.

3. Business Owner’s Policy (BOP)

A business owner’s policy (BOP) gives your small business protection against a wide range of claims. It does this by combining two types of coverage. Commercial general liability insurance and Commercial property insurance are both parts of its coverage. 

The part of a BOP called “general liability” protects your business in case someone makes a claim against you or your business. General liability insurance protects you from lawsuits if something like a customer slipping on a wet floor. Or a faulty product causing damage to a client’s property. Or a claim that your products or services hurt someone. It can also protect you from libel, slander, and certain advertising lawsuits.

The property part of a BOP helps protect the buildings, equipment, furniture. And stock that you own, rent, or lease for your business. It helps pay to fix or replace things that are stolen, broken, or destroyed, even if they don’t belong to you but were in your care. It can also pay for things like rent, payroll, and other bills while your property is being fixed or replaced after a fire or other covered loss.

4. Workers’ Compensation

If you have employees, no matter the nature of your business, you are required by law to carry workers’ compensation insurance. Workers’ compensation insurance, also known as “workers’ comp,” is a mandatory type of coverage that will provide financial support to your staff if they sustain an injury while performing their job duties. It serves as a disability insurance pool that reimburses workers monetarily and/or provides medical care in the event of an illness or injury. If you want to learn more about the workers’ compensation laws in your state, you can visit the state by state guides on our site.

5. Cyber Liability

Physical dangers such as injury and property loss are ever-present in the business world. However, there are dangers associated with using technology that could affect your company. Data leaks and hacking are just two examples. Information about customers’ identities or medical histories that you store on company computers is a prime target for hackers. In order to quickly recover from a data breach or cyberattack, it is crucial that your company be covered by data breach or cyber liability insurance. 

Self-Employed Health Insurance

If you’re in business for yourself, it’s important to have a basic understanding of health insurance. As a first step, you should enroll in a health insurance plan. If you do not have health insurance this year, you could be fined by the government depending on what state you live in. More importantly, you and your loved ones are taking a serious risk if and when a medical emergency arises.

In addition, if you have been relying on your employer to provide health coverage, you may be in for a rude awakening when you compare prices. Since you no longer have an employer to split the cost of health insurance with, you must do so on your own. The good news is that self-employed professionals can reduce their tax liability. The quickest way is by deducting the money they spend on health insurance premiums.

How To Reduce The Cost Of Self-Employed Health Insurance

A high-deductible health plan (HDHP) is a good option for those looking to save money on health insurance premiums. A higher deductible on your health insurance plan means you’ll have to pay more out of pocket for medical care before your policy kicks in. However, the trade-off is cheaper premiums every month.

Opening a health savings account (HSA) is an option with your high-deductible health plan, making it an even better value. The funds built up in a health savings account (HSA) are exempt from federal income tax, allowing you to save tax-free for future medical expenses. It’s a good idea to consult with an EZ agent, who can explain your options and guide you toward a policy that works for your finances and your loved ones. They will assist you in locating competitive rates and suitable protection.

Self-Employed Disability Insurance

If you’re self-employed and become ill or injured and unable to work, disability insurance could help replace some of your lost income. There are both public and private options for disability insurance. The government provides some options, such as the Social Security Administration and some state programs. 

When you’re self-employed, you can buy your own disability insurance policy rather than participating in a potentially more expensive group plan through your employer. You may still be eligible for a group policy through your spouse’s employer or a trade group. You may have more options with an individual policy, but the premiums may be higher. Policy features such as the waiting period, riders, and the definition of disability may be up for negotiation.  

Short vs Long Term Disability Insurance

Disability coverage comes in two flavors: long term and short term. Long term disability insurance typically has an elimination period of several weeks to months and a benefit period of several years up until retirement. There may be no waiting period or one as long as two weeks before benefits begin with short term disability insurance. Although long term disability insurance that pays out until retirement age is ideal, a short term policy could be worthwhile as well. In general, shorter waiting periods and longer benefits payout periods tend to come with higher premiums.

For an additional premium, you can secure coverage that the insurance provider can’t revoke for any reason (including your failure to pay premiums) with a noncancelable policy. With guaranteed renewable policies, the insurer cannot cancel your coverage. But they can raise your premiums along with other customers in your rating class.  Additional riders, such as cost-of-living adjustments (COLA), residual benefits in the event of a partial disability, premium refunds for going claim-free, premium waivers in the event of a disability, and so on, can be purchased for an additional cost.

EZ Can Help

Working independently or as a freelancer allows for more freedom and a better work-life balance. One disadvantage is that you will be responsible for arranging your own insurance. It’s essential that you do this. Since an accident or emergency can cause financial ruin if you don’t have the proper insurance.  As a result, self-employed people who don’t have insurance are taking a risk by not doing so. However, EZ can help! We offer free instant quotes on business insurance for the self-employed and we can even help you find the best plans for you. Enter your zip code in the box below or call one of our licensed agents at (855) 694-0047 to get started.

E&O Insurance

It’s easy to imagine a construction site requiring liability insurance in the event of an injury, or a supermarket needing a policy to cover a customer who slips and falls in the store. A general commercial liability insurance policy would cover these types of accidents. Product liability insurance would protect against a product’s failure. This is all damage that we typically hear about. However, what about damages that aren’t visible? If your company provides clients with advice or services, you likely need E&O (also known as professional liability). In the past professional liability was for professionals such as doctors or lawyers, whereas E&O was for semi-professionals such as accountants or financial advisors. But now, the terms are used interchangeably. E&O insurance protects you against claims of:

Bad advice

Many clients rely on professionals, such as lawyers and consultants, for sound, practical, and specialized advice. If a client receives advice from a professional and their expectations are not met, the client may sue. A client may file a lawsuit, for instance, if a personal trainer advises their client to do certain workouts or stretches that lead to muscle strains or injuries. Another example, say a hairdresser advises a client to use a certain product for their hair that leaves them with damaged hair or skin problems.

Negligence

When a professional fails to provide the standard level of care they are negligent. A judge may find a doctor negligent if, for instance, he or she fails to review a patient’s chart before prescribing an allergen-containing medication. If a financial advisor disregards all warnings about a company’s financial health and recommends stocks that ultimately fail, they can be sued for negligence.

Slander or libel

If a professional publicly expresses unfavorable or incorrect opinions about their client, they can be sued for slander. False or derogatory written statements are considered libel. Either scenario can lead to a costly lawsuit.

Omissions

An omission is the failure to provide important information that could alter a client’s decisions. For instance, if a real estate agent fails to mention that a home is in a flooding zone or has extensive damage from past problems the new homeowner could sue them for not giving them all of the facts.

Mistakes

Even the most professional people in the world can make mistakes. If a client is harmed or loses money due to an error made by a professional such as an attorney, doctor, accountant etc. They could file a lawsuit even though the error was not intentional.

Cost of E&O

The cost of E&O is determined by a number of variables, including the type of business, its location, and any prior claims you’ve had to pay out. Due to the increased underwriting risk, E&O insurance may be more expensive or have less than favorable terms for a person or business with a lengthy history of litigation issues. On average, E&O insurance can cost between $500 and $1,000 annually per employee.

What It Doesn’t Cover

E&O policies do not cover criminal prosecution and certain non-listed liabilities that may arise in civil court. This includes illegal acts, deliberate wrongdoing, and criminal activity. Typically E&O insurance does not cover bodily injury caused by your business, as this is covered by general liability insurance. E&O insurance also may or may not cover temporary employee’s claims resulting from work performed prior to the policy’s start date, or claims in different jurisdictions. It may also exclude cyber related information leaks, employee injuries, and discrimination claims.

EPLI

All of the above pertains to claims made by clients or customers against your company. However, how do you protect yourself from claims filed by your employees? Employers are protected by EPLI against lawsuits filed by current, former, or even prospective employees. In the same way that you have a duty to keep your customers safe and provide them with the best service, you also have a duty to treat all employees and potential hires fairly. This type of insurance kicks in when allegations are made such as:

• Sexual harassment
• Discrimination
• Wrongful termination
• Breach of employment contract
• Negligent evaluation
• Failure to employ or promote
• Wrongful disciplinary actions
• Deprivation of career opportunity
• Wrongful infliction of emotional distress
• Mismanagement of employee benefit plans

Keep in mind, however, that this type of insurance will cover owners, managers, and other employees if a claim is made against them, but will not cover anyone who has intentionally acted illegally. 

The cost of EPLI depends on the nature of your business, the number of employees you have, and various risk factors. Such as whether or not your company has been sued in the past for employment practices. The policies will reimburse your business for the costs associated with defending a lawsuit and for any judgements or settlements. Whether your company wins or loses a lawsuit, the policy will cover legal fees. In addition, policies typically exclude coverage for punitive damages and civil or criminal fines. EPLI policies exclude liabilities covered by other insurance policies, such as workers’ compensation.

Preventing Claims

To prevent employee lawsuits, start with educating your managers and employees so that you minimize these problems in the first place. For starters:

• Develop effective hiring and screening programs to prevent hiring discrimination.
• Post corporate policies throughout the workplace and include them in employee manuals so that everyone is aware of them.
• Show employees what to do if they experience sexual harassment or discrimination at the hands of a supervisor.
• Make sure that supervisors are aware of the company’s stance on unacceptable behaviors.
• Document everything that occurs and the steps taken to prevent and resolve employee conflicts.

What it Won’t Cover

EPLI would not cover claims resulting from intentionally dishonest or criminal conduct such as theft or intentional property destructions. It also does not cover employee illness or work-related injuries as these are covered with workers’ compensation. In addition to intentional or criminal acts, the following situations are typically not covered by EPLI:

• Professional errors – If your company makes a professional error you’ll need malpractice or E&O insurance to protect these situations.
• Unemployment insurance – Most states have a government agency dedicated to handling unemployment benefits claims, EPLI will not cover these.
• Unpaid wages – Typically, failing to pay wages for owed or completed work will not be covered by EPLI policies.
• Fines and penalties – EPLI will not cover civil or criminal fines.

Limited EPLI Coverage

In addition, you may find that your EPLI policy provides limited coverage or none at all for certain types of employment practice claims. Below we’ve listed the examples of these situations where coverage is typically limited.

• Breach of written employment contract – If any employee alleges that you violated your employment contract, whether the agreement was written or implied (EX: made in conversation) can be important. While most EPLI policies will cover the cost of claims related to implied contacts, written contracts may be handled differently by some policies. Some EPLI policies may cover written contract claims whereas many others will only cover legal defense costs or nothing for them.
• Wage and hourly claims – When an employee claims that their employer did not pay them in a timely manner. Since a number of costly and high-profile overtime pay claims have been filed in recent years, most EPLI policies will exclude or specify sub limits for wage and hourly claims because the risk exposure is too great. 
• Immigration violations – The majority of insurers do not offer EPLI coverage for federal, state, or local immigration-related violations (such as failing to check an employee’s immigration status). If so, it is typically a limited edition (or “endorsement”) to your EPLI policy.

Working With EZ

The world of commercial insurance can be extremely confusing, as it’s filled with a variety of policies that cover a variety of individuals and situations, as well as acronyms for a majority of policies. It’s important to evaluate your needs and get the best protection available. Remember that general commercial liability insurance does not cover everyone and everything, and you may need to supplement your policy with E&O and EPLI coverage.

If you need help making sense of the business insurance alphabet soup, we’re here to help! You will be assigned a personal agent by EZ.Insure, and you will never receive unwanted persistent phone calls. Our agents are highly trained and knowledgeable and will ensure you receive the exact coverage you need. Not to mention, we do all of this for free! To get your free instant quotes enter your zip code into the bar below. Or give one of our agents a call directly at (855) 694-0047.

If you’re a professional who provides a service to clients, like an accountant, attorney, or doctor, you’ll need professional liability insurance. It’s important to be able to protect yourself and your business from any type of wrongdoing or negligence. Professional liability covers your business in areas that general liability does not. The goal is to help professionals and business owners determine if this line of coverage is necessary.

Understanding Professional Liability Insurance

The purpose of professional liability insurance (also known as errors and omissions insurance) is to cover legal defense to protect a client-facing business from claims made by a third party. The main difference between general liability and professional liability is the risks they cover. 

General liability insurance will cover physical risks, like bodily injuries or property damage caused by your business’ daily operations. Professional liability covers financial losses resulting from negligence, errors, misrepresentation, or omissions that occur when you provide your services to others.

Who Needs Professional Liability Insurance?

1. Service-Based Professionals:

Professionals who provide advice, consultation, or services such as consultants, lawyers, accountants, architects & more should obtain coverage.

2. Medical and Healthcare Providers:

Doctors, nurses, therapists, and other healthcare professionals should have professional liability to help protect against malpractice claims.

3. Technology Professionals:

IT consultants, software developers, and tech service providers should consider this insurance to cover potential errors in their work when working with clients.

4. Creative Professionals:

 This is a necessity for designers, photographers, writers, and other creatives to protect against claims related to intellectual property or service disputes.

5. Real Estate Professionals:

Real estate agents, brokers, and property managers should get coverage to protect against errors in transactions or advice.

Key Scenarios Where Professional Liability Insurance Is Crucial

1. Client Contract Requirements:

Before engaging in a contract, clients may require proof of professional liability insurance.

2. Regulatory and Licensing Requirements:

In certain professions, professional liability insurance is mandated by regulatory bodies or for licensing purposes.

3. High-Risk Professions:

In high-risk professions, like the medical field, the likelihood of claims made is higher, making this coverage essential.

What Professional Liability Insurance Covers

• Attorney’s fees
• Court costs
• Investigator’s bills
• Settlements
• Judgements 

Benefits of Professional Liability Insurance

1. Peace of Mind

After obtaining coverage, you can rest knowing your business will be protected against legal disputes that can result in high costs.

2. Reputation Protection

Professional liability insurance can help safeguard your business’ reputation by addressing claims in a quick and professional manner.

3. Business Continuity

This crucial coverage also ensures that legal disputes won’t financially cripple your growing small business.

Conclusion

In service-based industries like medical, technology, creative, and real estate professions, the importance of professional liability insurance cannot be overstated. Even if you believe your risk is minimal, the financial impact of a single claim can be overwhelming, especially for small business owners. It’s crucial to assess your unique needs and consult with an insurance professional to ensure you have the right coverage in place. 

Protect your business and your peace of mind with plans tailored specifically to your business. At EZ.Insure, our agents are highly trained and work with the top companies in the nation. We can compare all of your policy options while working with your budget to get your company all the coverage it needs. For a free quote call (866) 792-2602 to be connected directly to one of our agents today.

Any business can make mistakes, but companies that offer industry specific expert services or consulting are more vulnerable to negligence claims when they make a mistake. If your company gets sued due to a mistake or misleading information, it could hurt both your reputation and your bottom line. Negligence suits are one of the most common and expensive types of claims companies face. Negligence claims fall under two categories, ordinary, and professional. Knowing the difference between the two can help you avoid a costly lawsuit. 

Ordinary Negligence

Ordinary negligence is defined as a failure to use ordinary or normal care. It usually refers to a careless error that has caused harm to others. Ordinary negligence can be filed against any business or even individuals. And it is the basis for all personal injury lawsuits. Because they did not follow the duty of care, a person or business could be held accountable for physical or financial harm caused by the negligent mistake. Four things must be proven to establish ordinary negligence:

Duty of Care

The first thing a plaintiff has to prove is that you had a duty of care toward him or her. This usually means that you have a duty to take reasonable care not to hurt the plaintiff. However, states can change this standard of care by law for certain relationships, like a doctor-patient relationship. Usually, a person owes someone else a duty of reasonable care if they can see how their actions could hurt others. For example, a driver owes a duty of care to everyone else on the road by not texting and driving. A store owes a duty of care to their customers by putting a “Wet Floor” sign over a spill. In personal injury claims, duty of care is almost never disputed because it’s just about proving that there was a duty of care owed to the plaintiff, not whether or not it was broken.

Breach

If the client can prove that you had a duty of care to him or her. The next question is whether or not you broke that duty. A breach happens when someone doesn’t act with the same level of care that a normal person would in the same or similar situation. This is where someone needs to prove that you broke the duty of care. Using the examples above for instance, an ideal person wouldn’t speed or drive while drunk. So, a driver who did either of these things would have broken their duty of care to other people on the road. For businesses you wouldn’t ignore a fall hazard, you’d put up a caution sign or rope the area off. If you do ignore it then you’ve broken the duty of care.

Causation

Next, the complainant must prove that your breach caused him or her harm. That is, the harm would not have happened if you had fulfilled your duty of care. Also, the breach must be the direct cause of the injury. This means that the law must agree that the breach is linked enough to the injury to make you legally responsible.

Damages

The last step is for the plaintiff to prove damages. Lawyers and courts say that negligence without damages is “negligence in the air”. For example, a driver who speeds may be guilty of a crime. But if the violation didn’t hurt anyone else, the state can’t hold him or her responsible for negligence. In personal injury cases, plaintiffs often try to get paid for their medical bills, lost wages, property damage, loss of quality of life, and physical and mental pain and suffering. So, say they slipped on the wet floor but had no injury from the fall. While you caused the fall you didn’t cause any injuries that need compensation. 

Professional Negligence

Unlike ordinary negligence, the rules for professional negligence usually only apply to businesses that offer specialized skills and services to their customers or clients. When a professional doesn’t do what they should for their customer or client. This can include not doing a job with the right amount of skill and care, giving bad advice, or not acting quickly enough. 

Professional negligence can happen in any job. Such as with doctors, lawyers, accountants, engineers, builders, and other people who provide professional services. Professionals are required by law to do their jobs with a certain amount of skill and care. If they don’t, they could be held responsible for any harm that happens to their patients or clients. There are two common types of professional liability:

Breach of fiduciary duty

When you don’t act in the best interests of your client, you break your fiduciary duty. This can include making bad decisions, not giving important information, not telling the client about conflicts of interest. Or pursuing opportunities meant for the company without telling the client, and using insider or non-public information in a stock market transaction.

For a client to make a legal claim for a fiduciary breach, they have to prove three basic things:

• There was a fiduciary relationship and responsibility
• A breach happened
• The breach caused damages to the client

Misrepresentation

Negligent misrepresentation is when you say something that you should have known wasn’t true but didn’t with the intention that your client will rely on it and suffer losses because of it. Some examples of misrepresentation are making false statements or promises in a contract or overstating the value or quality of goods or services. The misrepresentation doesn’t have to be in writing. It can be verbal. It can also mean not telling your client about all of the facts. There are 5 components to prove a misrepresentation claim:

• There was an important comment about a certain product. And the comment led the client to sign the contract or make a decision
• You knew that the information wasn’t entirely truthful or that you purposefully did not provide all of the facts
• You made the statement or gave the advice with the intention that your client would rely on it to make a decision or enter into a contract
• The client did in fact rely on that information

It’s not always easy to tell if a comment was a fact or someone’s opinion. And this can be a point of contention in a misrepresentation case. The court will look at how a reasonable person would have understood the information.

How To Avoid Professional Negligence Claims

If you offer the kinds of professional services that often lead to professional negligence claims. It’s important to be proactive and take steps to lower your risk of being sued. Let’s talk about a few of the best practices that could help you significantly reduce the risk of a lawsuit.

Contracts

Whether it’s a new client or an extension of a project you’re already working on, you should always insist on a clearly written contract that explains the nature and the limits of the job. It’s important to include every detail you can about the job. Having a clear contract will lower the risk of a negligence claim because your exact promises or the possibility of certain portions of the contract may not work out are listed.

Expectations

It’s easy to get carried away when you’re trying to get a client by making promises you’re not entirely sure you can keep. Even if you do have every intention of making it happen, there’s always the possibility of things not panning out. This is also a very easy way for a professional negligence claim to come about. Make sure you give your clients realistic expectations when you speak with them about how things will work out. Make sure to warn them about possible negative outcomes as well. This will help you avoid awkward and possibly expensive situations where your client feels they were cheated and should be compensated.

Communicate

It is very important to have clear communication with your client. If you let them know about problems and changes in a timely manner, they will think you are more responsible, even if the news is often bad. Changes that come up quickly and out of the blue may make the client upset and more likely to sue you for professional negligence. Keep in touch with your clients often. Even if you have nothing new to say, let them know that you are still working on their project and are fully committed to it.

Records

Unfortunately, a lot of cases of professional negligence start with “he said, she said” claims. The best way to deal with this is to keep careful records of all the professional services you provide. Email is always better than the phone for making deals and decisions because you can keep track of what was said and what was agreed upon. If you prefer to do business by phone or in person, record your talks with clients. If you don’t want to do that, get an email confirmation of what was agreed upon so you have a copy of what was said.

Learn

Keeping up with the latest changes in your industry will help protect you from professional negligence claims. Also, it’s important to keep up with changes to the way state rules govern duty of care.

How To Protect Your Business

Even when you’ve done everything to avoid a negligence claim, they can still happen to anyone. That’s why it’s important to be proactive and get ahead of possible claims by having a good risk management plan and the right business insurance to protect you. Professional liability insurance, which is also called “errors and omissions” insurance, will cover these kinds of cases. It will protect you financially from accusations of negligence, malpractice, errors, and omissions that could happen while you’re giving your clients professional services.

When a claim of professional negligence is made, your E&O policy will pay for your legal defense, judgements, and settlements up to the limits of the policy. It’s important to know that professional liability insurance is a “claims-made” coverage. This means that the policy had to be in effect when the event that led to the claim happened and when you told the insurer about the claim. Also, it’s important to remember that professional liability plans have things they won’t cover. One of the most common is when a professional does something illegal or hurts a client on purpose.

Call EZ

In general, all of the big insurance companies offer professional liability insurance. If you already have business insurance, talk to your insurance company about the possibility of adding professional liability to your coverage. But working with an insurance agent is your best bet. The agents at EZ are well-trained and work with some of the best companies in the country. We can look at all your policy choices and work with your budget to make sure your business has all the coverage it needs. If you would like to see quotes online simply enter your zip code in the box above. If you would like to speak to an agent now call 877-670-3538 today to talk to get a free quote.

What Is General Liability Insurance?

General liability insurance is the most basic kind of commercial insurance. It covers costs if a third party accuses your business of causing them physical harm, damaging their property, harming their reputation through slander, or advertising errors that infringe on their copyright. These policies are usually written on an “occurrence” basis, which means that all losses will be covered during the time of the policy period, regardless of when you file the claim. General liability insurance will cover expenses including:

• Court costs
• Attorney’s fees
• Settlements
• Judgements
• Third-party medical bills
• Third-party repair bills

What Is Professional Liability Insurance?

Professional liability insurance, which includes errors and omissions, or E&O, insurance, covers legal defense if a third party claims they suffered a financial loss as a result of your negligence. It is written on a “claims made” basis, which means that the damages had to have occurred within the active policy period or they will not be covered. Some of the claims that professional liability insurance covers include:

• Negligence
• Inaccurate professional advice
• Failure to uphold contractual promises
• Work that was not completed
• Work mistakes or omissions

Coverage will typically pay for:

• Attorney’s fees
• Court costs
• Investigator’s bills
• Settlements
• Judgements

How They Are Similar

Both protect against business liabilities and cover:

• Damage to third parties.
• Accidental damage, not intentional damage
• Restricted coverage within a specific area; if you go outside that area you will not be covered. 

How They Differ

The main difference between general liability and professional liability insurance is the risks they cover. General liability insurance will cover physical risks, like bodily injuries or property damage caused by your business’ daily operations. Professional liability covers financial losses resulting from negligence, errors, or omissions that occur when you provide your services to others.

Who Needs General Liability Insurance?

Every business owner should consider buying a general liability insurance plan to protect their assets. Accidents happen, and when you own a business, these accidents can be quite costly. You should consider general liability insurance if you:

• Have customers visiting your location.
• Rent a physical location.
• Handle other people’s property.
• Own a home-based business.
• Sell, manufacturer, or distribute products.
• Advertise your services.

Who Needs Professional Liability Insurance?

Professional liability insurance is important to consider if your business provides professional services and has specialized professional training. Some professionals might even be legally required to obtain this type of insurance. You should consider a professional liability insurance plan if you:

• Provide professional or technical services or advice.
• Are expected to maintain professional standards.

Some examples of people who should have professional liability insurance are lawyers, consultants, accountants, and technology inspectors.

Which Do You Need?

In many cases, you will need both policies to fully protect your business from an unexpected lawsuit. EZ.Insure provides licensed agents who are highly trained in commercial insurance and can help determine which policy better suits your business, or if you need the coverage of both types. We will compare all plans and find the plan that offers the most coverage at the best price. To get free quotes, simply enter your zip code in the bar above, or to speak with one of our specialized agents, call 888-615-4893.

What Is a Certificate Of Insurance?

If you have a car, then you have auto insurance, right? And if you have auto insurance, then you have an insurance ID card in your glove compartment. Think of a certificate of insurance as something similar.  A COI is a physical or electronic document that proves you have a valid commercial insurance policy. It is a quick overview of the policy you hold, and includes:

• Your name and business information
• The insurance company that issued your policy
• The policy number, effective date, and expiration date
• The type of policy (such as general liability or professional liability)
• Policy limits and deductible amounts
• Additional insured, meaning anyone else who is covered under your policy

These certificates might be packed with information, but they are only one page long. This means that you can post them in your place of business, or easily show them to clients (instead of having to pull out your multi-page insurance policy). 

Do I Need a COI?

If your business provides advice or services to customers or clients, then there is always the possibility for things to go wrong. A handyman might accidentally put a ladder through a window, a freelance IT tech could miss a data breach, a contractor might be overseeing a building site where someone gets injured. To protect against claims of physical injury, property damage, financial loss, or even bad advice, you

 need at least one type of commercial insurance policy, and a certificate of insurance to go along with it.

Not many companies or customers want to work with a business that doesn’t have insurance, so being able to show them that piece of paper is an extremely important way to keep your business growing. If you are a contractor, then you will probably be required by the companies that hire you to show a COI. Other business owners can preemptively offer a COI to a client as a way to earn trust, get an edge on the competition, or simply show that they are professionals who take their business seriously. 

How Do I Get One?

Finally, there’s something fairly simple associated with your business insurance! Getting your initial certificate of insurance shouldn’t require any extra work on your part, it should be included – for free – with all of the documents you receive after purchasing your policy. If you need additional certificates to give to clients, you can contact your insurance company, agent, or broker. These additional certificates are also free and should be quick and easy to get. If you need to add your client as an “additional insured” or add extra coverage for a specific job, then it may take a few days to a few weeks to get a new COI.

When it comes to your commercial insurance, your policy should be “if you’ve got it, flaunt it.” If you’ve taken the responsible step of insuring your business, then let your customers know – and watch your business take off. If you’re shopping around for commercial insurance, or need a new plan, then EZ.Insure is the place to be. We’ll answer all of your questions, give you instant quotes, even sign you up – all for free! Don’t go another day without the policies that will get you noticed, or with a policy that’s not working for you. Get started with us by simply entering your zip code in the bar above, or speak to an agent directly by calling 888-615-4893.