There are so many different kinds of insurance out there, and it may seem like too much of a good thing at times. You probably find yourself wondering why you need to cover every little thing in your life, and whether fear of the unknown or inevitable is any way to live.
Well, philosophical inquiries aside, there are in fact different kinds of insurance you absolutely need. Professional liability insurance is definitely way up there if you’re a small business that also happens to provide services.
The coverage will help ensure that you are out of the woods when something serious happens, especially if it involves a customer or client. Here are a few things you need to know about professional liability insurance and how it can help you.
Protection from Accusations
All small businesses work hard to cultivate happy customers. And most of this work is done well. However, there are cases in which a former customer or client may hold your business accountable for the wrongdoing of some kind, and will sue.
Professional liability insurance helps protect you from the very worst cases. A claim of negligence, for example, doesn’t only cost the customer, but your business – a lot. This sort of insurance also protects business owners from lawsuits emanating from disputes over work errors, unrendered services, breach of contract, incomplete or unsatisfactory work, and so on.
The insurance will not only help cover these costs but will also ensure that your business survives the rash of accusations.
Kind of Business
Professional liability insurance only applies to certain kinds of businesses and isn’t a one size fits all operation. For example, if you’re an accountant, you should definitely look into accountants insurance, since this will protect you from accusations that you went over budget, or had too many errors in your final report.
Professional liability insurance is also perfect for architectural firms, consultants, engineers, other kinds of insurance professionals, real estate agents, and the like. Basically, any service-based business should consider investing in professional liability insurance.
Another factor you should probably consider is how much professional liability insurance will cost you. This tends to vary depending on the kind of service your business offers. When approaching different companies, they will basically ask you about the kind of business you have and the level of risk involved.
Also, your history of claims or the number of employees at your business will also have an effect on how much you’re charged. When signing up, be sure to read the fine print regarding coverage limits and deductibles, and based on those numbers, you should choose the right sort of insurance for you.
Some sorts of service-oriented businesses come with lesser levels of risk in general, so they tend to pay less. Accountants will never pay as much in professional liability service as, say, engineers.
A small business is like having a baby that you need to tend to, and take care of as best you can. Professional liability insurance is not only recommended but required in many states. It’s really the best way to ensure that your business stays afloat, and can continue to function in case the worst – aka, litigation – should happen.