General Liability vs. Professional Liability Insurance

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You know you need small business insurance, but with all the different types of policies available, you might not know where to start. You have probably heard of both General Liability insurance and Professional Liability, or Errors and Omissions insurance, but do you know what they cover? It is critical that, as a small business owner, you can identify types of risk associated with your particular industry and know which types of insurance policies provide protection against them.

What is General Liability insurance?

General Liability insurance protects your business from unforeseen claims that arise related to bodily injury or property damage and personal and advertising injuries.

  • Bodily injury - when a third party, often a client, is on your premises and is injured, usually by a slip and fall.
  • Property damage - damage to a third party's property, such as client property that is in your care, custody, and control.
  • Personal/advertising injury - covers claims resulting from libel, slander, and defamation. Usually, these types of lawsuits pop up because of social media and a mistake made by an employee regarding a competitor.

Any liability claim that may be brought against you is sure to bring with it significant financial hardship by way of attorney fees and court costs. The good news is this policy will cover these defense costs, regardless of your guilt or involvement.

What is Professional Liability Insurance?

Professional Liability insurance is business insurance that is meant to provide coverage for those who offer professional services. Think lawyers, architects, therapists, doctors, or anyone providing a professional service or opinion. You may have also heard it referred to as E&O or malpractice insurance. The policy will pay for:

  • Errors and omissions - because you are still human and can make mistakes, but these mistakes can impact the client that you are providing the professional services to.
  • Breaches - because even unforeseen things can happen that can cause you or your business to be unable to fulfill a contract.
  • Defense costs - once again, you will be prepared to defend yourself in court if you have purchased a Professional Liability insurance policy.

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How Are They the Same?

General Liability and Professional Liability insurance are the same in that they are designed to protect you from certain liabilities associated with your business. As a small business owner, regardless of your risk management techniques, you will always be prone to lawsuits, as you have the most risks. Both policies pay for the costs associated with these lawsuits and help you avoid having to close your doors because of a disgruntled or injured party.

Business Insurance

Running a business is challenging enough without having to worry about lawsuits, employee injuries or property damage. Having the right insurance gives you the peace of mind to focus on what matters - running your business.

The coverage you need depends on the type of business you run. A restaurant owner needs to be covered against customers possibly getting food poisoning while an accountant needs to be covered against calculation errors. CoverWallet's intelligent assessment system will identify the insurance you need based on your specific business, get you a policy that fits your budget, and do it all in less time than you think.

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