Whether you are a plumber, artist, engineer, or accountant, you’ll want to consider purchasing professional liability insurance. Not only does it cover you in the event of a lawsuit, but it will also protect your business from legal expenses. A professional liability insurance policy will also cover other important considerations. Below are a few that you should consider when purchasing your own policy. For a professional liability insurance policy, consider its benefits and drawbacks.
Professional liability insurance can help you protect your business by paying for damages if you’re sued by a client for malpractice. It will pay for judgments and verdicts that you might lose as a result of a lawsuit. In addition to defending your business, it will also cover any mistakes your employees or independent contractors make in their jobs. Depending on your state’s legal system, you can even opt for punitive damages under certain policies.
Premiums for professional liability insurance vary depending on the profession that you work in. Most practitioners purchase $1 million per incident or $3 million per policy period. In a volatile legal environment, higher limits are necessary. If you work with clients that require medical attention, you should consider purchasing higher limits to protect yourself and your clients. Your coverage may include Medicare/Medicaid investigations and licensing board complaints. For more information, contact a professional liability insurance broker.
Before purchasing professional liability insurance, you should consider how long you intend to practice. If you’re new to the industry, you may want to purchase a claims-made policy that covers any claim made while you’re practicing. However, if you’re considering switching careers, an occurrence policy is an excellent option. This type of policy will cover any malpractice claims that occur while your policy is in effect.
The cost of Professional Liability Insurance may be tax-deductible for employees. Premiums are also tax-exempt if they fall under the definition of “accountable plans” under the Internal Revenue Code. The policy will also cover expenses for investigations, congressional testimony, and civil lawsuits that result from allegations of wrongdoing. It will also cover whistleblowers, ethics complaints, and administrative costs associated with official duties. The insurance will appoint a lawyer to represent you in legal proceedings.
Some employers offer coverage under the terms and conditions of their policies. However, this coverage may not be adequate. In many cases, you may not receive priority when allegations are filed against you, nor will you be fully covered for costs associated with defending complaints against you before licensing boards. The coverage may not cover activities outside your employment agreement and scope of practice. Therefore, you should consider purchasing your own policy.
