Common Professional Liability Lawsuits
The US service sector is incredibly vast, diverse, and complex. According to the Bureau of Labor Statistics, of the more than 150 million people working in the U.S., over 120 million were employed in the service sector. Millions of these companies across the U.S. operate in over a dozen industries. With so many moving parts and types of services being rendered, the probability that individual workers or companies will make mistakes while offering services is exceptionally high. While not all errors will lead to a lawsuit, many do.
Common lawsuits among service sector companies include:
- Breach of contract
- Failure to render services
- Significant financial loss
- Omissions or errors
Professional Liability claims are often expensive to argue in court, so the claims are often charged against businesses when the financial losses are very costly. Doctors, surgeons, CPAs, lawyers, and architects are often targets of these type of lawsuits. This is because of the kind of errors that these individuals may make are usually quite expensive for clients or customers.
For example: A CPA who fails to manage a client's account properly could result in that client losing tens of thousands of dollars, if not more. This is particularly the case if the customer was a business, and the CPA was responsible for managing complex business tax codes that were filed incorrectly. A lawsuit in this situation would be almost certain to occur. Professional Liability insurance would help to cover the CPA and his or her company during the process, provide financial protections for the judicial proceedings and may cover a certain amount of the payout, depending on the total liability coverage.
Or, consider a lawsuit stemming from oversights and errors. If an architecture firm designs a building that fails to meet specific safety standards, the construction company may have to go back and fix those errors. This will be costly both for the construction company and the client for whom the company is constructing the building. Either the construction company or the entity who will own the finished building may file a lawsuit against the architecture firm for oversights and errors that caused significant cost overruns.