A good insurance policy is a must for any business owner. Liability insurance can offer protection against any damage sustained by a third party in connection with your business.
Most business owners think that general liability coverage is sufficient, but this isn't always the case. Supplementing your general liability coverage with a professional liability policy is the best way to protect your business against serious financial harm in the future.
1. Claims Coverage
One of the primary differences between a general liability policy and a professional liability policy is in the way these insurance plans approach a claim. General liability offers coverage on an occurrence basis. This means that anytime a problem arises, the occurrence of the problem will activate your insurance policy.
Professional liability insurance is written on a claims made basis. An individual will need to provide valid proof of the origination of their problem. This approach means that your company can be protected against paying for any claims made on issues that started before your relationship with a third party victim was established.
2. Damage Coverage
Another key difference between general and professional liability insurance policies is the type of damages each policy covers. A general liability policy typically covers any physical harm caused by using your company's products or services.
A professional liability policy offers a broader range of coverage. The coverage under a professional liability policy extends to any damages — physical or financial — that are caused by your company providing (or not providing) professional services.
A broader range of coverage means that a professional liability policy can offer a greater level of protection for your business over time.
3. Specific Coverage
Just as the name suggests, general liability insurance policies are designed to offer general coverage. This generalized coverage may not serve the unique needs of your company.
All companies are at risk of having a customer slip and fall while inside their commercial space, but many professional companies have targeted and specific risks related to the services they provide.
Professional liability insurance is designed to be industry specific. This allows your policy to provide coverage for the unique financial risks that you face while conducting business on a routine basis.
Combining general liability coverage with a professional liability policy is the best way to ensure your company is protected against financial damage. Talk to a professional liability insurance provider about your coverage options today.