Professional Liability Insurance
Professional Liability Insurance in Memphis, TN
Clients pay you for what you know. When they believe your advice or service cost them money, they can sue to get it back, even if you did the job right. Professional liability insurance in Memphis pays to defend those claims and covers settlements up to your policy limit. At Jones Enterprises Insurance Brokers, our agents help consultants, service firms, and independent professionals find E&O coverage that matches the contracts they sign.
How Is Professional Liability Different From General Liability?
Professional liability covers financial losses your work causes a client, while general liability covers physical injuries and property damage. If a visitor slips in your office, that's a general liability claim. If a client says your bookkeeping error led to IRS penalties, that's a professional liability claim. Most service businesses need both, and neither policy fills in for the other. Our general liability insurance page explains the injury and property side in detail.
What an E&O Policy Pays For
Errors and omissions insurance is the other name you'll hear for this coverage. The wording varies by insurance company, but most policies share these parts.
Mistakes and Negligence
This part covers claims that you made an error or gave advice that turned out to be wrong. A wrong figure in a financial report or a misconfigured network are typical examples.
Missed Deadlines and Unfinished Work
If a client says a late or incomplete project cost them business, this part responds. It applies to the allegation itself, so you're defended while the facts get sorted out.
Defense Costs
Professional liability pays your attorney from the first letter a client's lawyer sends. On many E&O policies, defense costs count against your limit, so a long case reduces what's left for a settlement. That's one reason to choose a limit with room to spare.
Claims-Made Coverage
Most E&O policies are claims-made. They cover claims first filed while the policy is active, for work done after a retroactive date listed in the policy. Keeping coverage in force without a gap protects that date.
Comparing E&O Policies With Jones Enterprises
Professional liability forms differ more than most business coverage. Some exclude contract disputes, and others limit what they'll cover for certain professions. We look at policies from more than one insurance company and point out those differences before you sign.
For performers and vendors, errors and omissions protection is already part of the general and professional liability policies we offer. Those policies also cover bodily injury, 3rd party property damage, defense costs, and medical coverage.
Many professionals add cyber insurance as well, since an E&O policy often excludes a data breach involving client files. You can see the rest of the policies we offer on the Jones Enterprises Insurance Brokers home page.
Professional Liability Insurance for Memphis Professionals
An accountant in Bartlett and an IT consultant in Horn Lake face the same risk: a client who blames them for a loss. The same goes for a marketing firm in Marion. We help professionals across Memphis and the surrounding area put the right protection in place. Along with Nashville and Dallas, the agency covers individuals in Tennessee and Texas, and businesses nationwide.
Questions About E&O Coverage
Is E&O insurance required in Tennessee?
For some professions, yes. Tennessee requires active real estate licensees to carry errors and omissions coverage. Many other professionals carry it because client contracts and vendor agreements ask for proof before work begins.
What is tail coverage?
Tail coverage, also called an extended reporting period, lets you report claims after a claims-made policy ends. It matters when you retire, close your business, or switch insurers. Common options run 1, 3, or 5 years.
Will the policy pay if the claim has no merit?
Yes. A professional liability policy pays to defend you against covered claims even when they're groundless. That defense can be the largest cost in a case that never reaches trial.
What affects the cost of professional liability coverage?
Your profession, annual revenue, claims history, chosen limit, and deductible all set the price. A firm doing higher-risk work, such as financial advice, usually pays more than one in lower-risk work with a clean record.
Can I get coverage after I've received a demand letter?
Not for that matter. Insurers exclude claims and circumstances you knew about before the policy started. Buying coverage before trouble appears is the only way to have it apply.
Before You Sign the Next Contract
Read the insurance section of your next client agreement, then call us with the limit it asks for. One of our friendly agents will compare E&O options with you and get you a quote.