Professional liability can serve as a good layer of protection for a small business attempting to thrive. When one thinks of a small business, it often conjures up the image of an owner and a few employees. Surprisingly, the Small Business Association defines a small business as one with under 500 employees, which accounts for 99.9% of U.S. businesses. Faced with risks from many angles, any small business should consider having professional liability coverage.
How Does Professional Liability Differ From General Liability?
While any business with employees must carry workers’ compensation, they may not necessarily have to acquire other forms of insurance. Any savvy business owner knows mistakes can happen, making acquiring general liability an intelligent choice. In general, it covers:
- Bodily injury claims
- Medical fees for anyone injured on the property
- Property damage that a business or its employees caused.
This insurance ensures that a business will not incur out-of-pocket expenses if a minor incident happens. Unfortunately, regardless of the business, more catastrophic events may occur. Professional liability insurance delivers another layer of protection to help business owners deal with lawsuits efficiently.
Who Needs Professional Liability Insurance in Ohio?
Anyone who wonders how you can know if you need professional liability insurance must consider the type of work they do. Business owners who operate their own businesses and offer services or advice should consider professional liability. Industries that often opt for this additional coverage include:
- Accountants
- IT
- Architects
- Investment advisors
- Engineers
The need for this coverage may also depend on a business’s clientele. If normal operations include signing contracts, the client may require proof of this type of insurance to ensure liability falls where it should the business fails to deliver what it promised. When it comes to contractors, many clients will refuse to do business with a company that does not have professional liability.
What Benefits Does Professional Liability Provide?
This form of insurance protects businesses from lawsuits and associated costs. Whether the person or business suing has a legitimate claim, the business getting sued will still have to pay for defense fees, court fees, and possibly a settlement. Types of lawsuits small businesses may face include:
- Negligence to meet a standard of care
- Failure to meet a designated deadline
- Improper installation of equipment by a subcontractor
- Professional misconduct by an employee
A host of other events can happen that may lead a client to believe that a business has made a breach of contract or otherwise provided inaccurate advice or delivered services that do not meet the agreed-upon end results. With this coverage, a business has a better chance of continuing regular operations without severe business interruption.
When considering benefits, cost also factors in. Although it means added expenses, the monthly amount may seem relatively minimal compared to receiving a bill from a lawyer. Factors that play into the cost include the type of business, number of employees, coverage limits, and years in business. Businesses that face higher risks, such as construction, may have higher premiums than accountants.
Any small business owner, whether it has a few or hundreds of employees, has invested a lot in building the company. Professional liability offers another way to protect that hard work.
About Haughn & Associates
Founded by Michael Haughn in 1986, Haughn & Associates is a full-service, family-owned, independent insurance agency based out of Dublin, Ohio. H&A strives to provide the best possible price and unique insurance solutions across a myriad of industries, including construction, IT, Habitation & Commercial Property, Agriculture, and Engineering. Devoted to providing the best of business insurance, life and disability insurance, personal insurance, employee benefits, and bonds, H&A is proof that success lies in long-standing client relations and satisfaction. To learn more about how H&A can be of service to you, contact us at (877) 802-2278.
